Yahoo Finance Does National Bank of Canada's (TSE:NA) CEO Salary Reflect Performance?
Louis Vachon became the CEO of National Bank of Canada (TSE:NA) in 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for National Bank of Canada
How Does Louis Vachon's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that National Bank of Canada has a market cap of CA$21b, and is paying total annual CEO compensation of CA$8.9m. (This is based on the year to October 2018). While we always look at total compensation first, we note that the salary component is less, at CA$1.1m. When we examined a group of companies with market caps over CA$11b, we found that their median CEO total compensation was CA$9.1m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
So Louis Vachon receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
You can see a visual representation of the CEO compensation at National Bank of Canada, below.
Is National Bank of Canada Growing?
Over the last three years National Bank of Canada has grown its earnings per share (EPS) by an average of 21% per year (using a line of best fit). In the last year, its revenue is up 3.3%.
This demonstrates that the company has been improving recently. A good result. It's also good to see modest revenue growth, suggesting the underlying business is healthy. You might want to check this free visual report on analyst forecasts for future earnings.
Has National Bank of Canada Been A Good Investment?
Boasting a total shareholder return of 61% over three years, National Bank of Canada has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
Louis Vachon is paid around what is normal the leaders of larger companies.
Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. So one could argue the CEO compensation is quite modest, if you consider company performance! If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at National Bank of Canada.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
