In 2014 David Findlay was appointed CEO of Lakeland Financial Corporation (NASDAQ:LKFN). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. 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.
How Does David Findlay's Compensation Compare With Similar Sized Companies?
According to our data, Lakeland Financial Corporation has a market capitalization of US$1.1b, and pays its CEO total annual compensation worth US$1.6m. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$567k. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO total compensation of that group was US$2.8m.
A first glance this seems like a real positive for shareholders, since David Findlay is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Lakeland Financial has changed over time.
Is Lakeland Financial Corporation Growing?
Over the last three years Lakeland Financial Corporation has grown its earnings per share (EPS) by an average of 19% per year (using a line of best fit). In the last year, its revenue is up 11%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has Lakeland Financial Corporation Been A Good Investment?
With a total shareholder return of 24% over three years, Lakeland Financial Corporation shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
It appears that Lakeland Financial Corporation remunerates its CEO below most similar sized companies. Since the business is growing, many would argue this suggests the pay is modest. The total shareholder return might not be amazing, but that doesn't mean that David Findlay is paid too much.
It's good to see reasonable payment of the CEO, even while the business improves. But it would be nice if insiders were also buying shares. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Lakeland Financial (free visualization of insider trades).
Important note: Lakeland Financial may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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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. Thank you for reading.