David Findlay has been the CEO of Lakeland Financial Corporation (NASDAQ:LKFN) since 2014, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For David Findlay Compare With Other Companies In The Industry?
According to our data, Lakeland Financial Corporation has a market capitalization of US$1.4b, and paid its CEO total annual compensation worth US$1.6m over the year to December 2019. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$593k.
For comparison, other companies in the same industry with market capitalizations ranging between US$1.0b and US$3.2b had a median total CEO compensation of US$2.5m. That is to say, David Findlay is paid under the industry median. What's more, David Findlay holds US$11m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, roughly 43% of total compensation represents salary and 57% is other remuneration. In Lakeland Financial's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Lakeland Financial Corporation's Growth Numbers
Lakeland Financial Corporation's earnings per share (EPS) grew 11% per year over the last three years. Its revenue is down 3.7% over the previous year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Lakeland Financial Corporation Been A Good Investment?
Lakeland Financial Corporation has generated a total shareholder return of 19% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
As we noted earlier, Lakeland Financial pays its CEO lower than the norm for similar-sized companies belonging to the same industry. But over the last three years, EPS growth has been growing rapidly, which is a great sign for the company. Shareholder returns, in comparison, have not been as impressive. Shareholder returns could be better but we're pleased with the positive EPS growth. As a result of these considerations, CEO compensation seems quite appropriate.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for Lakeland Financial (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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