In 2016 Paul Ng was appointed CEO of China Demeter Financial Investments Limited (HKG:8120). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Paul Ng’s Compensation Compare With Similar Sized Companies?
Our data indicates that China Demeter Financial Investments Limited is worth HK$39m, and total annual CEO compensation was reported as HK$1.8m for the year to December 2018. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at HK$1.6m. We looked at a group of companies with market capitalizations under HK$1.6b, and the median CEO total compensation was HK$1.8m.
So Paul Ng is paid around the average of the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see a visual representation of the CEO compensation at China Demeter Financial Investments, below.
Is China Demeter Financial Investments Limited Growing?
On average over the last three years, China Demeter Financial Investments Limited has grown earnings per share (EPS) by 4.1% each year (using a line of best fit). Its revenue is up 64% over last year.
I like the look of the strong year-on-year improvement in revenue. Combined with modest EPS growth, we get a good impression of the company. So while I’d stop short of saying growth is absolutely outstanding, there are definitely some clear positives! Although we don’t have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has China Demeter Financial Investments Limited Been A Good Investment?
With a three year total loss of 70%, China Demeter Financial Investments Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
Paul Ng is paid around the same as most CEOs of similar size companies.
The company cannot boast particularly strong per share growth. And shareholder returns have been disappointing over the last three years. So many would argue that the CEO is certainly not underpaid. Whatever your view on compensation, you might want to check if insiders are buying or selling China Demeter Financial Investments shares (free trial).
If you want to buy a stock that is better than China Demeter Financial Investments, this free list of high return, low debt companies is a great place to look.
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