We Think Shareholders Are Less Likely To Approve A Pay Rise For China Vocational Education Holdings Limited's (HKG:1756) CEO For Now

Key Insights

• China Vocational Education Holdings to hold its Annual General Meeting on 17th of January
• Total pay for CEO Zhifeng Zhang includes CN¥1.85m salary
• The total compensation is similar to the average for the industry
• China Vocational Education Holdings' EPS grew by 47% over the past three years while total shareholder loss over the past three years was 42%

The underwhelming share price performance of China Vocational Education Holdings Limited (HKG:1756) in the past three years would have disappointed many shareholders. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 17th of January. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for China Vocational Education Holdings

Comparing China Vocational Education Holdings Limited's CEO Compensation With The Industry

Our data indicates that China Vocational Education Holdings Limited has a market capitalization of HK$804m, and total annual CEO compensation was reported as CN¥2.3m for the year to August 2024. That's mostly flat as compared to the prior year's compensation. In particular, the salary of CN¥1.85m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Consumer Services industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was CN¥1.9m. From this we gather that Zhifeng Zhang is paid around the median for CEOs in the industry.

Component	2024	2023	Proportion (2024)
Salary	CN¥1.9m	CN¥2.2m	79%
Other	CN¥490k	CN¥174k	21%
Total Compensation	CN¥2.3m	CN¥2.4m	100%

Talking in terms of the industry, salary represented approximately 84% of total compensation out of all the companies we analyzed, while other remuneration made up 16% of the pie. Our data reveals that China Vocational Education Holdings allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

China Vocational Education Holdings Limited's Growth

China Vocational Education Holdings Limited has seen its earnings per share (EPS) increase by 47% a year over the past three years. It achieved revenue growth of 17% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has China Vocational Education Holdings Limited Been A Good Investment?

The return of -42% over three years would not have pleased China Vocational Education Holdings Limited shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at China Vocational Education Holdings.

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

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.