Shareholders May Be More Conservative With Man Shing Global Holdings Limited's (HKG:8309) CEO Compensation For Now

In the past three years, the share price of Man Shing Global Holdings Limited (HKG:8309) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 05 August 2021. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

See our latest analysis for Man Shing Global Holdings

Comparing Man Shing Global Holdings Limited's CEO Compensation With the industry

According to our data, Man Shing Global Holdings Limited has a market capitalization of HK$86m, and paid its CEO total annual compensation worth HK$3.0m over the year to March 2021. That's a notable increase of 47% on last year. Notably, the salary which is HK$2.38m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.5m. Hence, we can conclude that Man Sing Wong is remunerated higher than the industry median. What's more, Man Sing Wong holds HK$25m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2021	2020	Proportion (2021)
Salary	HK$2.4m	HK$1.5m	80%
Other	HK$595k	HK$520k	20%
Total Compensation	HK$3.0m	HK$2.0m	100%

Speaking on an industry level, nearly 90% of total compensation represents salary, while the remainder of 10% is other remuneration. Man Shing Global Holdings sets aside a smaller share of compensation for salary, in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Man Shing Global Holdings Limited's Growth Numbers

Over the past three years, Man Shing Global Holdings Limited has seen its earnings per share (EPS) grow by 107% per year. Its revenue is up 7.1% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Man Shing Global Holdings Limited Been A Good Investment?

Few Man Shing Global Holdings Limited shareholders would feel satisfied with the return of -43% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Shareholders have not seen their shares grow in value, rather they have seen their shares decline. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 4 warning signs for Man Shing Global Holdings that investors should be aware of in a dynamic business environment.

Important note: Man Shing Global Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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