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How Should Investors Feel About LivePerson, Inc.'s (NASDAQ:LPSN) CEO Pay?

Simply Wall St

Rob LoCascio became the CEO of LivePerson, Inc. (NASDAQ:LPSN) in 1995. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for LivePerson

How Does Rob LoCascio's Compensation Compare With Similar Sized Companies?

According to our data, LivePerson, Inc. has a market capitalization of US$2.4b, and pays its CEO total annual compensation worth US$3.0m. (This number is for the twelve months until December 2018). While we always look at total compensation first, we note that the salary component is less, at US$612k. We examined companies with market caps from US$1.0b to US$3.2b, and discovered that the median CEO total compensation of that group was US$4.0m.

So Rob LoCascio is paid around the average of the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

The graphic below shows how CEO compensation at LivePerson has changed from year to year.

NasdaqGS:LPSN CEO Compensation, August 14th 2019

Is LivePerson, Inc. Growing?

On average over the last three years, LivePerson, Inc. has shrunk earnings per share by 5.8% each year (measured with a line of best fit). It achieved revenue growth of 14% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has LivePerson, Inc. Been A Good Investment?

Boasting a total shareholder return of 394% over three years, LivePerson, Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Remuneration for Rob LoCascio is close enough to the median pay for a CEO of a similar sized company .

We feel that earnings per share have been a bit disappointing, but it's nice to see positive shareholder returns over the last three years. So we think most shareholders wouldn't be too worried about CEO compensation, which is close to the median for similar sized companies. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling LivePerson (free visualization of insider trades).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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.