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Should You Be Pleased About The CEO Pay At Lindsay Corporation's (NYSE:LNN)

In 2017, Tim Hassinger was appointed CEO of Lindsay Corporation (NYSE:LNN). First, this article will compare CEO compensation with compensation at similar sized companies. 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.

Check out our latest analysis for Lindsay

How Does Tim Hassinger's Compensation Compare With Similar Sized Companies?

Our data indicates that Lindsay Corporation is worth US$942m, and total annual CEO compensation was reported as US$4.3m for the year to August 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$933k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations from US$400m to US$1.6b, and the median CEO total compensation was US$3.3m.

Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Lindsay. Talking in terms of the sector, salary represented approximately 16% of total compensation out of all the companies we analysed, while other remuneration made up 84% of the pie. It's interesting to note that Lindsay pays out a greater portion of remuneration through salary, in comparison to the wider industry.

So Tim Hassinger is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance. The graphic below shows how CEO compensation at Lindsay has changed from year to year.

NYSE:LNN CEO Compensation May 4th 2020
NYSE:LNN CEO Compensation May 4th 2020

Is Lindsay Corporation Growing?

Lindsay Corporation has reduced its earnings per share by an average of 35% a year, over the last three years (measured with a line of best fit). It saw its revenue drop 13% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.

Has Lindsay Corporation Been A Good Investment?

Lindsay Corporation has not done too badly by shareholders, with a total return of 2.9%, over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

Remuneration for Tim Hassinger is close enough to the median pay for a CEO of a similar sized company .

The company isn't growing earnings per share, and nor have the total returns inspired us. We wouldn't say the CEO pay is too high, but one might argue that the company should improve returns to shareholders before increasing it. Moving away from CEO compensation for the moment, we've identified 2 warning signs for Lindsay that you should be aware of before investing.

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 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.

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. Thank you for reading.

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