Is Lamar Advertising Company (REIT)’s (NASDAQ:LAMR) CEO Pay Fair?

Sean Reilly has been the CEO of Lamar Advertising Company (REIT) (NASDAQ:LAMR) since 2011. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Lamar Advertising Company (REIT)

How Does Sean Reilly’s Compensation Compare With Similar Sized Companies?

According to our data, Lamar Advertising Company (REIT) has a market capitalization of US$9.0b, and paid its CEO total annual compensation worth US$5.6m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$700k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. 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 Sean Reilly 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.

You can see, below, how CEO compensation at Lamar Advertising Company (REIT) has changed over time.

NasdaqGS:LAMR CEO Compensation, January 2nd 2020
NasdaqGS:LAMR CEO Compensation, January 2nd 2020

Is Lamar Advertising Company (REIT) Growing?

On average over the last three years, Lamar Advertising Company (REIT) has grown earnings per share (EPS) by 5.4% each year (using a line of best fit). It achieved revenue growth of 7.6% over the last year.

I would argue that the improvement in revenue isn’t particularly impressive, but it is good to see modest EPS growth. It’s clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Shareholders might be interested in this free visualization of analyst forecasts.

Has Lamar Advertising Company (REIT) Been A Good Investment?

Boasting a total shareholder return of 49% over three years, Lamar Advertising Company (REIT) has done well by shareholders. 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 Sean Reilly is close enough to the median pay for a CEO of a similar sized company .

The company isn’t showing particularly great growth, but shareholder returns have been pleasing. So all things considered I’d venture that the CEO pay is appropriate. Shareholders may want to check for free if Lamar Advertising Company (REIT) insiders are buying or selling shares.

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.