Yahoo Finance Our Take On National Bank of Canada’s (TSE:NA) CEO Salary
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In 2007 Louis Vachon was appointed CEO of National Bank of Canada (TSE:NA). This analysis aims first to contrast CEO compensation with other large companies. After that, we will consider the growth in the business. 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.
Check out our latest analysis for National Bank of Canada
How Does Louis Vachon’s Compensation Compare With Similar Sized Companies?
According to our data, National Bank of Canada has a market capitalization of CA$21b, and pays its CEO total annual compensation worth CA$9.3m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at CA$1.1m. When we examined a group of companies with market caps over CA$11b, we found that their median CEO compensation was CA$8.6m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts – even though some are quite a bit bigger than others).
So Louis Vachon is paid around the average of the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see a visual representation of the CEO compensation at National Bank of Canada, below.
Is National Bank of Canada Growing?
National Bank of Canada has increased its earnings per share (EPS) by an average of 18% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 7.5%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. 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?
I think that the total shareholder return of 90%, over three years, would leave most National Bank of Canada shareholders smiling. 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.
The company is growing earnings per share and total shareholder returns have been pleasing. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. So you may want to check if insiders are buying National Bank of Canada shares with their own money (free access).
Important note: National Bank of Canada may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
