Should You Worry About China Tontine Wines Group Limited's (HKG:389) CEO Pay Cheque?
Guangyuan Wang became the CEO of China Tontine Wines Group Limited (HKG:389) in 2008. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for China Tontine Wines Group
How Does Guangyuan Wang's Compensation Compare With Similar Sized Companies?
According to our data, China Tontine Wines Group Limited has a market capitalization of HK$262m, and paid its CEO total annual compensation worth CN¥1.7m over the year to December 2018. It is worth noting that the CEO compensation consists almost entirely of the salary, worth CN¥1.7m. We looked at a group of companies with market capitalizations under CN¥1.4b, and the median CEO total compensation was CN¥1.6m.
So Guangyuan Wang is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see, below, how CEO compensation at China Tontine Wines Group has changed over time.
Is China Tontine Wines Group Limited Growing?
Over the last three years China Tontine Wines Group Limited has grown its earnings per share (EPS) by an average of 53% per year (using a line of best fit). It saw its revenue drop 11% over the last year.
This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. Although we don't have analyst forecasts shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has China Tontine Wines Group Limited Been A Good Investment?
Given the total loss of 48% over three years, many shareholders in China Tontine Wines Group Limited are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Guangyuan Wang is paid around the same as most CEOs of similar size companies.
We like that the company is growing EPS, but we find the returns over the last three years to be lacking. We'd be surprised if shareholders want to see a pay rise for the CEO, but we'd stop short of calling their pay too generous. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling China Tontine Wines Group (free visualization of insider trades).
Important note: China Tontine Wines Group 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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.
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. Thank you for reading.
