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Does LiveRamp Holdings, Inc.'s (NYSE:RAMP) CEO Pay Reflect Performance?

Simply Wall St

In 2011 Scott Howe was appointed CEO of LiveRamp Holdings, Inc. (NYSE:RAMP). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for LiveRamp Holdings

How Does Scott Howe's Compensation Compare With Similar Sized Companies?

According to our data, LiveRamp Holdings, Inc. has a market capitalization of US$3.1b, and paid its CEO total annual compensation worth US$6.6m over the year to March 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$685k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$4.9m.

It would therefore appear that LiveRamp Holdings, Inc. pays Scott Howe more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

You can see, below, how CEO compensation at LiveRamp Holdings has changed over time.

NYSE:RAMP CEO Compensation, January 22nd 2020

Is LiveRamp Holdings, Inc. Growing?

On average over the last three years, LiveRamp Holdings, Inc. has shrunk earnings per share by 66% each year (measured with a line of best fit). It achieved revenue growth of 34% over the last year.

The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. You might want to check this free visual report on analyst forecasts for future earnings.

Has LiveRamp Holdings, Inc. Been A Good Investment?

Most shareholders would probably be pleased with LiveRamp Holdings, Inc. for providing a total return of 70% over three years. 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...

We compared the total CEO remuneration paid by LiveRamp Holdings, Inc., and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

One might like to have seen stronger growth, but shareholder returns have been pleasing, over the last three years. As a result of the juicy return to investors, the CEO remuneration may well be quite reasonable. Shareholders may want to check for free if LiveRamp Holdings insiders are buying or selling shares.

Important note: LiveRamp Holdings 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.

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.