Todd Bluedorn became the CEO of Lennox International Inc. (NYSE:LII) in 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Todd Bluedorn's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Lennox International Inc. has a market cap of US$9.4b, and reported total annual CEO compensation of US$7.5m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$1.2m. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a selection of companies with market caps ranging from US$4.0b to US$12b, we found the median CEO total compensation was US$6.6m.
So Todd Bluedorn 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.
You can see, below, how CEO compensation at Lennox International has changed over time.
Is Lennox International Inc. Growing?
Over the last three years Lennox International Inc. has grown its earnings per share (EPS) by an average of 16% per year (using a line of best fit). Its revenue is down 4.2% over last year.
This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. Shareholders might be interested in this free visualization of analyst forecasts.
Has Lennox International Inc. Been A Good Investment?
Most shareholders would probably be pleased with Lennox International Inc. for providing a total return of 63% 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.
Todd Bluedorn is paid around what is normal the leaders of comparable size companies.
The company is growing earnings per share and total shareholder returns have been pleasing. Indeed, many might consider the pay rather modest, given the solid company performance! So you may want to check if insiders are buying Lennox International shares with their own money (free access).
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.
If you spot an error that warrants correction, please contact the editor at email@example.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.
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