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In 2016 Sherman Jen was appointed CEO of China Maple Leaf Educational Systems Limited (HKG:1317). First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. 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 Sherman Jen’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that China Maple Leaf Educational Systems Limited has a market cap of HK$9.4b, and is paying total annual CEO compensation of CN¥3.6m. (This number is for the twelve months until August 2018). We think total compensation is more important but we note that the CEO salary is lower, at CN¥3.4m. We looked at a group of companies with market capitalizations from CN¥2.8b to CN¥11b, and the median CEO total compensation was CN¥2.9m.
So Sherman Jen receives a similar amount to the median CEO pay, amongst 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 a visual representation of the CEO compensation at China Maple Leaf Educational Systems, below.
Is China Maple Leaf Educational Systems Limited Growing?
Over the last three years China Maple Leaf Educational Systems Limited has grown its earnings per share (EPS) by an average of 23% per year (using a line of best fit). It achieved revenue growth of 18% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. It could be important to check this free visual depiction of what analysts expect for the future.
Has China Maple Leaf Educational Systems Limited Been A Good Investment?
With a total shareholder return of 1.7% over three years, China Maple Leaf Educational Systems Limited has done okay by shareholders. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.
Sherman Jen is paid around what is normal the leaders of comparable size companies.
The company is growing EPS but shareholder returns have been sound but not amazing. So upon reflection one could argue that the CEO pay is quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling China Maple Leaf Educational Systems shares (free trial).
Important note: China Maple Leaf Educational Systems 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.
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.
If you spot an error that warrants correction, please contact the editor at email@example.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. Thank you for reading.