Yahoo Finance We Think Shareholders May Want To Consider A Review Of IAC Inc.'s (NASDAQ:IAC) CEO Compensation Package
Key Insights
IAC will host its Annual General Meeting on 11th of June
Total pay for CEO Joey Levin includes US$1.00m salary
The overall pay is comparable to the industry average
IAC's EPS declined by 60% over the past three years while total shareholder loss over the past three years was 70%
Shareholders will probably not be too impressed with the underwhelming results at IAC Inc. (NASDAQ:IAC) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 11th of June. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.
Check out our latest analysis for IAC
Comparing IAC Inc.'s CEO Compensation With The Industry
According to our data, IAC Inc. has a market capitalization of US$4.3b, and paid its CEO total annual compensation worth US$5.0m over the year to December 2023. Notably, that's an increase of 13% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.0m.
In comparison with other companies in the American Interactive Media and Services industry with market capitalizations ranging from US$2.0b to US$6.4b, the reported median CEO total compensation was US$4.4m. From this we gather that Joey Levin is paid around the median for CEOs in the industry. What's more, Joey Levin holds US$176m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$1.0m | US$1.0m | 20% |
Other | US$4.0m | US$3.5m | 80% |
Total Compensation | US$5.0m | US$4.5m | 100% |
On an industry level, roughly 24% of total compensation represents salary and 76% is other remuneration. In IAC's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. 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 IAC Inc.'s Growth Numbers
IAC Inc. has reduced its earnings per share by 60% a year over the last three years. Its revenue is down 16% over the previous year.
The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 IAC Inc. Been A Good Investment?
The return of -70% over three years would not have pleased IAC Inc. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.
Whatever your view on compensation, you might want to check if insiders are buying or selling IAC shares (free trial).
Switching gears from IAC, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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.
