Why The LGL Group, Inc.’s (NYSEMKT:LGL) CEO Pay Matters To You
In 2014 Michael Ferrantino was appointed CEO of The LGL Group, Inc. (NYSEMKT:LGL). 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 process should give us an idea about how appropriately the CEO is paid.
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How Does Michael Ferrantino’s Compensation Compare With Similar Sized Companies?
According to our data, The LGL Group, Inc. has a market capitalization of US$32m, and pays its CEO total annual compensation worth US$387k. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$215k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO compensation was US$303k.
So Michael Ferrantino is paid around the average of the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at LGL Group has changed from year to year.
Is The LGL Group, Inc. Growing?
Over the last three years The LGL Group, Inc. has grown its earnings per share (EPS) by an average of 109% per year (using a line of best fit). Its revenue is up 7.0% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions.
We don’t have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has The LGL Group, Inc. Been A Good Investment?
Most shareholders would probably be pleased with The LGL Group, Inc. for providing a total return of 86% over three years. 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 Michael Ferrantino is close enough to the median pay for a CEO of a similar sized company .
Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. So one could argue the CEO compensation is quite modest, if you consider company performance! Whatever your view on compensation, you might want to check if insiders are buying or selling LGL Group shares (free trial).
Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .
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.
