Sheldon Adelson became the CEO of Las Vegas Sands Corp. (NYSE:LVS) in 2004. First, this article will compare CEO compensation with compensation at other large companies. Then we’ll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Want to help shape the future of investing tools? Participate in a short research study and receive a 6-month subscription to the award winning Simply Wall St research tool (valued at $60)!
How Does Sheldon Adelson’s Compensation Compare With Similar Sized Companies?
Our data indicates that Las Vegas Sands Corp. is worth US$45b, and total annual CEO compensation is US$26m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at US$5.0m. We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO compensation to be US$11m. There aren’t very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
It would therefore appear that Las Vegas Sands Corp. pays Sheldon Adelson more than the median CEO remuneration at large companies, in the same market. However, this fact alone doesn’t mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Las Vegas Sands has changed over time.
Is Las Vegas Sands Corp. Growing?
On average over the last three years, Las Vegas Sands Corp. has grown earnings per share (EPS) by 28% each year (using a line of best fit). Its revenue is up 6.6% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions.
Shareholders might be interested in this free visualization of analyst forecasts. .
Has Las Vegas Sands Corp. Been A Good Investment?
Boasting a total shareholder return of 46% over three years, Las Vegas Sands Corp. 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.
We compared the total CEO remuneration paid by Las Vegas Sands Corp., and compared it to remuneration at a group of other large companies. We found that it pays well over the median amount paid in the benchmark group.
However, the earnings per share growth over three years is certainly impressive. Even better, returns to shareholders have been plentiful, over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling Las Vegas Sands shares (free trial).
Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.