Stock Analysis

Shareholders May Not Be So Generous With Lincoln Educational Services Corporation's (NASDAQ:LINC) CEO Compensation And Here's Why

  •  Updated
NasdaqGS:LINC
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CEO Scott Shaw has done a decent job of delivering relatively good performance at Lincoln Educational Services Corporation (NASDAQ:LINC) recently. As shareholders go into the upcoming AGM on 06 May 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Lincoln Educational Services

How Does Total Compensation For Scott Shaw Compare With Other Companies In The Industry?

According to our data, Lincoln Educational Services Corporation has a market capitalization of US$178m, and paid its CEO total annual compensation worth US$1.8m over the year to December 2020. Notably, that's an increase of 80% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$500k.

On examining similar-sized companies in the industry with market capitalizations between US$100m and US$400m, we discovered that the median CEO total compensation of that group was US$945k. Hence, we can conclude that Scott Shaw is remunerated higher than the industry median. What's more, Scott Shaw holds US$5.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20202019Proportion (2020)
Salary US$500k US$500k 28%
Other US$1.3m US$477k 72%
Total CompensationUS$1.8m US$977k100%

On an industry level, roughly 20% of total compensation represents salary and 80% is other remuneration. It's interesting to note that Lincoln Educational Services pays out a greater portion of remuneration through salary, compared to the industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
NasdaqGS:LINC CEO Compensation April 29th 2021

A Look at Lincoln Educational Services Corporation's Growth Numbers

Lincoln Educational Services Corporation has seen its earnings per share (EPS) increase by 126% a year over the past three years. In the last year, its revenue is up 7.2%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Lincoln Educational Services Corporation Been A Good Investment?

Most shareholders would probably be pleased with Lincoln Educational Services Corporation for providing a total return of 250% 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 decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for Lincoln Educational Services (2 can't be ignored!) that you should be aware of before investing here.

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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