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Is Landstar System, Inc.'s (NASDAQ:LSTR) CEO Paid Enough Relative To Peers?

Simply Wall St

Jim Gattoni became the CEO of Landstar System, Inc. (NASDAQ:LSTR) in 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 Landstar System

How Does Jim Gattoni's Compensation Compare With Similar Sized Companies?

Our data indicates that Landstar System, Inc. is worth US$4.5b, and total annual CEO compensation was reported as US$5.5m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$500k. 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$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$5.1m.

That means Jim Gattoni receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.

You can see a visual representation of the CEO compensation at Landstar System, below.

NasdaqGS:LSTR CEO Compensation, October 24th 2019
NasdaqGS:LSTR CEO Compensation, October 24th 2019

Is Landstar System, Inc. Growing?

Landstar System, Inc. has increased its earnings per share (EPS) by an average of 29% a year, over the last three years (using a line of best fit). It achieved revenue growth of 5.7% over the last year.

This demonstrates that the company has been improving recently. A good result. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. You might want to check this free visual report on analyst forecasts for future earnings.

Has Landstar System, Inc. Been A Good Investment?

I think that the total shareholder return of 67%, over three years, would leave most Landstar System, Inc. shareholders smiling. 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 Jim Gattoni is close enough to the median pay for a CEO of a similar sized company .

Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Landstar System.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

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.