We Think The Compensation For News Corporation's (NASDAQ:NWSA) CEO Looks About Right
Key Insights
News will host its Annual General Meeting on 15th of November
Salary of US$3.00m is part of CEO Robert Thomson's total remuneration
Total compensation is similar to the industry average
News' EPS grew by 91% over the past three years while total shareholder return over the past three years was 28%
CEO Robert Thomson has done a decent job of delivering relatively good performance at News Corporation (NASDAQ:NWSA) recently. As shareholders go into the upcoming AGM on 15th of November, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. We present our case of why we think CEO compensation looks fair.
See our latest analysis for News
How Does Total Compensation For Robert Thomson Compare With Other Companies In The Industry?
According to our data, News Corporation has a market capitalization of US$12b, and paid its CEO total annual compensation worth US$19m over the year to June 2023. This means that the compensation hasn't changed much from last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$3.0m.
In comparison with other companies in the American Media industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$19m. So it looks like News compensates Robert Thomson in line with the median for the industry.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$3.0m | US$3.1m | 16% |
Other | US$16m | US$17m | 84% |
Total Compensation | US$19m | US$20m | 100% |
Speaking on an industry level, nearly 17% of total compensation represents salary, while the remainder of 83% is other remuneration. Our data reveals that News allocates salary more or less in line with the wider market. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
News Corporation's Growth
News Corporation's earnings per share (EPS) grew 91% per year over the last three years. It saw its revenue drop 4.9% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has News Corporation Been A Good Investment?
News Corporation has served shareholders reasonably well, with a total return of 28% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
In Summary...
Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 3 warning signs for News that investors should be aware of in a dynamic business environment.
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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
