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Is Nexstar Media Group, Inc. (NASDAQ:NXST) Excessively Paying Its CEO?

Simply Wall St

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In 1996 Perry Sook was appointed CEO of Nexstar Media Group, Inc. (NASDAQ:NXST). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Nexstar Media Group

How Does Perry Sook's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Nexstar Media Group, Inc. has a market cap of US$4.6b, and is paying total annual CEO compensation of US$15m. (This figure is for the year to December 2018). That's actually a decrease on the year before. While we always look at total compensation first, we note that the salary component is less, at US$1.5m. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$5.3m.

It would therefore appear that Nexstar Media Group, Inc. pays Perry Sook more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Nexstar Media Group has changed over time.

NasdaqGS:NXST CEO Compensation, June 18th 2019

Is Nexstar Media Group, Inc. Growing?

Nexstar Media Group, Inc. has increased its earnings per share (EPS) by an average of 54% a year, over the last three years (using a line of best fit). It achieved revenue growth of 11% over the last year.

This demonstrates that the company has been improving recently. A good result. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. It could be important to check this free visual depiction of what analysts expect for the future.

Has Nexstar Media Group, Inc. Been A Good Investment?

I think that the total shareholder return of 115%, over three years, would leave most Nexstar Media Group, Inc. shareholders smiling. 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.

In Summary...

We examined the amount Nexstar Media Group, Inc. pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

However we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. So, considering this good performance, the CEO compensation may be quite appropriate. So you may want to check if insiders are buying Nexstar Media Group shares with their own money (free access).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.