Yahoo Finance We Think Bombardier Inc.'s (TSE:BBD.B) CEO Compensation Looks Fair
Key Insights
Bombardier to hold its Annual General Meeting on 25th of April
Total pay for CEO Éric Martel includes US$883.5k salary
Total compensation is similar to the industry average
Bombardier's EPS grew by 94% over the past three years while total shareholder return over the past three years was 152%
It would be hard to discount the role that CEO Éric Martel has played in delivering the impressive results at Bombardier Inc. (TSE:BBD.B) recently. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 25th of April. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.
See our latest analysis for Bombardier
How Does Total Compensation For Éric Martel Compare With Other Companies In The Industry?
Our data indicates that Bombardier Inc. has a market capitalization of CA$5.5b, and total annual CEO compensation was reported as US$6.5m for the year to December 2023. That is, the compensation was roughly the same as last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$884k.
On examining similar-sized companies in the Canadian Aerospace & Defense industry with market capitalizations between CA$2.8b and CA$8.8b, we discovered that the median CEO total compensation of that group was US$6.7m. From this we gather that Éric Martel is paid around the median for CEOs in the industry. Moreover, Éric Martel also holds CA$7.8m worth of Bombardier stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$884k | US$884k | 14% |
Other | US$5.6m | US$5.8m | 86% |
Total Compensation | US$6.5m | US$6.7m | 100% |
On an industry level, around 56% of total compensation represents salary and 44% is other remuneration. Bombardier sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
Bombardier Inc.'s Growth
Over the past three years, Bombardier Inc. has seen its earnings per share (EPS) grow by 94% per year. It achieved revenue growth of 16% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has Bombardier Inc. Been A Good Investment?
Most shareholders would probably be pleased with Bombardier Inc. for providing a total return of 152% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
Some shareholders will probably be more lenient on CEO compensation in the upcoming AGM given the pleasing performance of the company recently. Seeing that earnings growth and share price performance seems to be on the right path, the more pressing focus for shareholders at the AGM may be how the board and management plans to turn the company into a sustainably profitable one.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 4 warning signs for Bombardier (2 don't sit too well with us!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
