Our Take On LegacyTexas Financial Group, Inc.’s (NASDAQ:LTXB) CEO Salary
In 2012 Kevin Hanigan was appointed CEO of LegacyTexas Financial Group, Inc. (NASDAQ:LTXB). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for LegacyTexas Financial Group
How Does Kevin Hanigan’s Compensation Compare With Similar Sized Companies?
Our data indicates that LegacyTexas Financial Group, Inc. is worth US$1.6b, and total annual CEO compensation is US$2.2m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$750k. We looked at a group of companies with market capitalizations from US$1.0b to US$3.2b, and the median CEO compensation was US$3.6m.
A first glance this seems like a real positive for shareholders, since Kevin Hanigan is paid less than the average compensation paid by similar sized companies. Though positive, it’s important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at LegacyTexas Financial Group has changed from year to year.
Is LegacyTexas Financial Group, Inc. Growing?
LegacyTexas Financial Group, Inc. has increased its earnings per share (EPS) by an average of 13% a year, over the last three years In the last year, its revenue is up 7.1%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see modest revenue growth, suggesting the underlying business is healthy.
It could be important to check this free visual depiction of what analysts expect for the future.
Has LegacyTexas Financial Group, Inc. Been A Good Investment?
I think that the total shareholder return of 44%, over three years, would leave most LegacyTexas Financial Group, Inc. shareholders smiling. This strong performance might mean some shareholders don’t mind if the CEO is paid more than is normal for a company of its size.
In Summary…
It appears that LegacyTexas Financial Group, Inc. remunerates its CEO below most similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Kevin Hanigan deserves a raise!
It is relatively rare to see a modestly paid CEO when performance is so impressive. The cherry on top would be if company insiders are buying shares with their own money. Shareholders may want to check for free if LegacyTexas Financial Group insiders are buying or selling shares.
Or you might prefer this data-rich interactive visualization of historic revenue and earnings.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
