24/7 Wall St. will name its annual CEO of the Year next week. The executive will be picked from a field of ten which we will profile this week.
The CEOs are chosen on the basis of their company’s stock market and financial performances compared with their own industry groups and all large companies traded on US markets. Only firms with market caps of more than $5 billion were considered. 24/7 reviewed revenue growth, operating margins, balance sheets, return on assets, and return on equity.
Large media content companies have had a brutal year primarily as the recession has cut spending for advertising. Shares in CBS (CBS) are down more than 78%. Rupert Murdoch, considered by many to be the most clever media firm operator in the world, has watched shares in his News Corp (NWS) drop nearly 65%.
The only big media stock to outperform the DJIA is Disney (DIS). To a very large extent that is because CEO Robert Iger has managed to efficiently operate and balance Disney’s theme park, television network, cable content, movie studio, and consumer products divisions. Revenue and segment operating income at all of Disney’s four major divisions were flat to higher for the last fiscal year.
The firm’s peers should be so lucky. Disney’s balance sheet has remarkably little leverage when put up against the balance of the industry. Disney has been careful to continue to develop properties like ESPN and its animation studios which should serve it well as the recession spreads. A decision to cut costs in expensive divisions like the movie studio operation has paid off at the bottom line this year. His alliance with Apple’s (AAPL) Steve Jobs in both animation and digital content delivery is a huge asset.
Douglas A. McIntyre