The Compensation For Laureate Education, Inc.'s (NASDAQ:LAUR) CEO Looks Deserved And Here's Why

Key Insights

• Laureate Education will host its Annual General Meeting on 30th of May
• CEO Eilif Serck-Hanssen's total compensation includes salary of US$850.0k
• The overall pay is comparable to the industry average
• Laureate Education's total shareholder return over the past three years was 137% while its EPS grew by 125% over the past three years

We have been pretty impressed with the performance at Laureate Education, Inc. (NASDAQ:LAUR) recently and CEO Eilif Serck-Hanssen deserves a mention for their role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 30th of May. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. Here is our take on why we think CEO compensation is not extravagant.

Check out our latest analysis for Laureate Education

How Does Total Compensation For Eilif Serck-Hanssen Compare With Other Companies In The Industry?

According to our data, Laureate Education, Inc. has a market capitalization of US$2.5b, and paid its CEO total annual compensation worth US$4.5m over the year to December 2023. That's a notable decrease of 10% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$850k.

On examining similar-sized companies in the American Consumer Services industry with market capitalizations between US$2.0b and US$6.4b, we discovered that the median CEO total compensation of that group was US$5.4m. This suggests that Laureate Education remunerates its CEO largely in line with the industry average. What's more, Eilif Serck-Hanssen holds US$9.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$850k	US$850k	19%
Other	US$3.6m	US$4.1m	81%
Total Compensation	US$4.5m	US$5.0m	100%

On an industry level, roughly 21% of total compensation represents salary and 79% is other remuneration. Our data reveals that Laureate Education allocates salary more or less in line with the wider market. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Laureate Education, Inc.'s Growth Numbers

Laureate Education, Inc. has seen its earnings per share (EPS) increase by 125% a year over the past three years. Its revenue is up 17% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Laureate Education, Inc. Been A Good Investment?

Most shareholders would probably be pleased with Laureate Education, Inc. for providing a total return of 137% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Laureate Education that investors should be aware of in a dynamic business environment.

Important note: Laureate Education is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.