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Is LivePerson Inc’s (NASDAQ:LPSN) CEO Pay Fair?

Rob LoCascio has been the CEO of LivePerson Inc (NASDAQ:LPSN) since 1995. 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. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for LivePerson

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

Our data indicates that LivePerson Inc is worth US$1.1b, and total annual CEO compensation is US$5.3m. (This figure is for the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$552k. We looked at a group of companies with market capitalizations from US$400m to US$1.6b, and the median CEO compensation was US$2.3m.

Thus we can conclude that Rob LoCascio receives more in total compensation than the median of a group of companies in the same market, and of similar size to LivePerson Inc. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see, below, how CEO compensation at LivePerson has changed over time.

NasdaqGS:LPSN CEO Compensation November 29th 18

Is LivePerson Inc Growing?

On average over the last three years, LivePerson Inc has grown earnings per share (EPS) by 7.6% each year. In the last year, its revenue is up 11%.

I would argue that the modest growth in revenue is a notable positive. And, while modest, the earnings per share growth is noticeable. So while we’d stop just short of calling this a top performer, but we think it is well worth watching.

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 130% over three years, LivePerson Inc 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.

In Summary…

We compared the total CEO remuneration paid by LivePerson Inc, 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.

While we generally prefer to see stronger EPS growth, there’s no arguing with the strong returns to shareholders, over the last three years. As a result of the juicy return to investors, the CEO remuneration may well be quite reasonable. Shareholders may want to check for free if LivePerson 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.