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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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Vince McMahon’s Compensation Compare With Similar Sized Companies?
Our data indicates that World Wrestling Entertainment, Inc. is worth US$5.7b, and total annual CEO compensation is US$5.7m. (This is based on the year to December 2018). We note that’s an increase of 83% above last year. While we always look at total compensation first, we note that the salary component is less, at US$1.4m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12b. The median total CEO compensation was US$7.0m.
So Vince McMahon is paid around the average of the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.
You can see a visual representation of the CEO compensation at World Wrestling Entertainment, below.
Is World Wrestling Entertainment, Inc. Growing?
Over the last three years World Wrestling Entertainment, Inc. has grown its earnings per share (EPS) by an average of 47% per year (using a line of best fit). It achieved revenue growth of 16% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. 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?
Most shareholders would probably be pleased with World Wrestling Entertainment, Inc. for providing a total return of 332% over three years. 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.
Vince McMahon is paid around what is normal the leaders of comparable size companies.
Few would be critical of the leadership, since returns have been juicy and earnings per share are moving in the right direction. So one could argue the CEO compensation is quite modest, if you consider company performance! Whatever your view on compensation, you might want to check if insiders are buying or selling World Wrestling Entertainment shares (free trial).
Important note: World Wrestling Entertainment may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE 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 email@example.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.