The CEO of Jinhui Holdings Company Limited (HKG:137) is Thomas Ng. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Thomas Ng's Compensation Compare With Similar Sized Companies?
According to our data, Jinhui Holdings Company Limited has a market capitalization of HK$355m, and paid its CEO total annual compensation worth HK$28m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at HK$23m. We examined a group of similar sized companies, with market capitalizations of below HK$1.6b. The median CEO total compensation in that group is HK$1.8m.
It would therefore appear that Jinhui Holdings Company Limited pays Thomas Ng more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Jinhui Holdings has changed over time.
Is Jinhui Holdings Company Limited Growing?
Jinhui Holdings Company Limited has increased its earnings per share (EPS) by an average of 123% a year, over the last three years (using a line of best fit). It saw its revenue drop 21% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. Revenue growth is a real positive for growth, but ultimately profits are more important. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Jinhui Holdings Company Limited Been A Good Investment?
With a three year total loss of 36%, Jinhui Holdings Company Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
We examined the amount Jinhui Holdings Company Limited pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. On the other hand returns to investors over the same period have probably disappointed many. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Jinhui Holdings (free visualization of insider trades).
Important note: Jinhui Holdings 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.
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