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In 2009 Vince McMahon was appointed CEO of World Wrestling Entertainment, Inc. (NYSE:WWE). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Vince McMahon’s Compensation Compare With Similar Sized Companies?
Our data indicates that World Wrestling Entertainment, Inc. is worth US$6.9b, and total annual CEO compensation is US$3.1m. (This figure is for the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$1.4m. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO compensation of that group was US$6.4m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you’ll need to understand the business better before you can form an opinion.
You can see a visual representation of the CEO compensation at World Wrestling Entertainment, below.
Is World Wrestling Entertainment, Inc. Growing?
On average over the last three years, World Wrestling Entertainment, Inc. has grown earnings per share (EPS) by 45% each year (using a line of best fit). Its revenue is up 16% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has World Wrestling Entertainment, Inc. Been A Good Investment?
Boasting a total shareholder return of 502% over three years, World Wrestling Entertainment, Inc. has done well by shareholders. 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.
World Wrestling Entertainment, Inc. is currently paying its CEO below what is normal for companies of its size. Many would consider this to indicate that the pay is modest since the business is growing. The strong history of shareholder returns might even have some thinking that Vince McMahon deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. So you may want to check if insiders are buying World Wrestling Entertainment shares with their own money (free access).
If you want to buy a stock that is better than World Wrestling Entertainment, this free list of high return, low debt companies is a great place to look.
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.