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Does IDT Corporation's (NYSE:IDT) CEO Salary Reflect Performance?

Simply Wall St

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Shmuel Jonas has been the CEO of IDT Corporation (NYSE:IDT) since 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for IDT

How Does Shmuel Jonas's Compensation Compare With Similar Sized Companies?

Our data indicates that IDT Corporation is worth US$219m, and total annual CEO compensation is US$855k. (This figure is for the year to July 2018). While we always look at total compensation first, we note that the salary component is less, at US$495k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO total compensation was US$1.1m.

So Shmuel Jonas receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at IDT, below.

NYSE:IDT CEO Compensation, June 21st 2019

Is IDT Corporation Growing?

IDT Corporation has reduced its earnings per share by an average of 63% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is down -6.7%.

Unfortunately, earnings per share have trended lower over the last three years. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has IDT Corporation Been A Good Investment?

Since shareholders would have lost about 20% over three years, some IDT Corporation shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

Remuneration for Shmuel Jonas is close enough to the median pay for a CEO of a similar sized company .

Returns have been disappointing and the company is not growing its earnings per share. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. Shareholders may want to check for free if IDT insiders are buying or selling shares.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.