SLM Corporation (NASDAQ:SLM), known as Sallie Mae, has amended its severance plan for senior officers, effective Monday, June 18, 2024. The Delaware-based personal credit institution made the announcement in a filing with the Securities and Exchange Commission today.
The revised SLM Corporation Amended and Restated Change in Control Severance Plan for Senior Officers will affect employees at the level of Senior Vice President and above, including named executive officers. The plan outlines severance payments and benefits for eligible officers in the event of termination without cause or for good reason, within six months before or 24 months after a change in control of the company.
Eligible officers who are terminated will receive a lump sum payment, calculated using a multiplier based on their position, and the sum of their base salary and target bonus opportunity. The multipliers range from 1.5 for Senior Vice Presidents to 2.5 for the Chief Executive Officer. Moreover, terminated officers are entitled to outplacement services and the employer portion of COBRA health insurance premiums for a specified period.
In the event of a change in control, outstanding and unvested equity awards may continue under existing terms. However, if the surviving corporation does not adopt and assume an officer's equity awards, they will vest and become exercisable at the greater of the target level or the actual performance level.
Moreover, the company held its Annual Meeting of Stockholders on Monday, June 18, 2024. Twelve directors were elected to serve until the 2025 Annual Meeting. The stockholders also approved the compensation of named executive officers and ratified the appointment of KPMG LLP as the independent registered public accounting firm for the year ending December 31, 2024.
The details of the amended severance plan are set to be included in SLM's quarterly report for the fiscal quarter ending June 30, 2024. This article is based on the press release statement and the company's SEC filing.
In other recent news, SLM Corp, also known as Sallie Mae, has seen a significant increase in its first-quarter earnings for 2024, with a GAAP diluted EPS of $1.27 per share, a substantial rise from $0.47 in the same period of the previous year.
TD Cowen has maintained a Buy rating for the company and raised the stock price target from $25 to $27, reflecting confidence in SLM Corp's operational strategies and financial performance. This decision followed discussions with SLM's CFO, Peter Graham, during the Financial Services & Fintech Summit, where various strategic aspects of the company's business were covered.
In addition to this, SLM Corp recently finalized a $1.5 billion loan sale, completing the transaction earlier than anticipated by analysts. The company also reported a healthy growth in loan originations and a decrease in net private education loan charge-offs.
TD Cowen's positive outlook is based on these recent financial moves and discussions with the company's CFO, which shed light on SLM's current market position and its plans for growth.
Meanwhile, Sylvamo reported its first quarter 2024 financial results, surpassing analyst revenue expectations and slightly exceeding EPS estimates. The company reported earnings of $1.07 per share and revenue of $905 million, both higher than consensus estimates. These recent developments reflect a positive outlook for both companies in their respective sectors, based on recent analyst reports and company earnings calls.
InvestingPro Insights
In light of SLM Corporation's recent amendments to its severance plan, investors may find the following InvestingPro data and tips pertinent. SLM Corporation, with a market capitalization of $4.57 billion, is trading at an attractive earnings multiple of 6.38, with an adjusted P/E ratio for the last twelve months as of Q1 2024 sitting slightly lower at 6.22. This valuation comes in the context of a robust revenue growth of 41.26% over the last twelve months, signaling a strong financial performance.
One of the InvestingPro Tips highlights that management has been aggressively buying back shares, which is often a sign of confidence in the company's future prospects and can be an indicator of potential value for shareholders. Moreover, the company is not only profitable over the last twelve months but is also expected to remain profitable this year according to analyst predictions. These factors, combined with a high shareholder yield, make SLM an intriguing consideration for investors seeking growth and value.
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