Is Sheung Yue Group Holdings Limited’s (HKG:1633) CEO Pay Justified?

Edmond Chan is the CEO of Sheung Yue Group Holdings Limited (HKG:1633). 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. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Sheung Yue Group Holdings

How Does Edmond Chan’s Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Sheung Yue Group Holdings Limited has a market cap of HK$157m, and reported total annual CEO compensation of HK$1.9m for the year to March 2019. Notably, the salary of HK$1.9m is the vast majority of the CEO compensation. 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 Edmond Chan 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, below, how CEO compensation at Sheung Yue Group Holdings has changed over time.

SEHK:1633 CEO Compensation, February 5th 2020
SEHK:1633 CEO Compensation, February 5th 2020

Is Sheung Yue Group Holdings Limited Growing?

On average over the last three years, Sheung Yue Group Holdings Limited has shrunk earnings per share by 96% each year (measured with a line of best fit). It achieved revenue growth of 52% over the last year.

The reduction in earnings per share, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. These two metric are moving in different directions, so while it’s hard to be confident judging performance, we think the stock is worth watching. Although we don’t have analyst forecasts shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Sheung Yue Group Holdings Limited Been A Good Investment?

Since shareholders would have lost about 95% over three years, some Sheung Yue Group Holdings Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.

In Summary…

Edmond Chan is paid around what is normal the leaders of comparable size companies.

We would like to see somewhat stronger per share growth. And we think the shareholder returns – over three years – have been underwhelming. So it would take a bold person to suggest the pay is too modest. Shareholders may want to check for free if Sheung Yue Group Holdings insiders are buying or selling shares.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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