In 2013 Brian Harris was appointed CEO of Ladder Capital Corp (NYSE:LADR). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Brian Harris's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Ladder Capital Corp has a market cap of US$2.2b, and reported total annual CEO compensation of US$17m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$1.0m. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. 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$3.9m.
As you can see, Brian Harris is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Ladder Capital Corp is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Ladder Capital, below.
Is Ladder Capital Corp Growing?
On average over the last three years, Ladder Capital Corp has grown earnings per share (EPS) by 9.9% each year (using a line of best fit). It saw its revenue drop 35% over the last year.
I would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see EPS growth. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Shareholders might be interested in this free visualization of analyst forecasts.
Has Ladder Capital Corp Been A Good Investment?
Boasting a total shareholder return of 71% over three years, Ladder Capital Corp has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
We compared the total CEO remuneration paid by Ladder Capital Corp, 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. Considering this fine result for investors, we daresay the CEO compensation might be apt. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Ladder Capital (free visualization of insider trades).
If you want to buy a stock that is better than Ladder Capital, this free list of high return, low debt companies is a great place to look.
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