Why We Think News Corporation's (NASDAQ:NWSA) CEO Compensation Is Not Excessive At All

Key Insights

• News' Annual General Meeting to take place 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' total shareholder return over the past three years was 28% while its EPS grew by 91% over the past three years

Under the guidance of CEO Robert Thomson, News Corporation (NASDAQ:NWSA) has performed reasonably well 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

Comparing News Corporation's CEO Compensation With 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. That is, the compensation was roughly the same as last year. While we always look at total compensation first, our analysis shows that the salary component is less, 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. From this we gather that Robert Thomson is paid around the median for CEOs in 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%

On an industry level, around 17% of total compensation represents salary and 83% is other remuneration. There isn't a significant difference between News and the broader market, in terms of salary allocation in the overall compensation package. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at News Corporation's Growth Numbers

Over the past three years, News Corporation has seen its earnings per share (EPS) grow by 91% per year. In the last year, its revenue is down 4.9%.

Shareholders would be glad to know that the company has improved itself over the last few years. 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 generated a total shareholder return of 28% over three years, so most shareholders would be reasonably content. 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.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay 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.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for News that you should be aware of before investing.

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.