Shareholders Will Probably Hold Off On Increasing Modern Healthcare Technology Holdings Limited's (HKG:919) CEO Compensation For The Time Being

CEO Joyce Tsang has done a decent job of delivering relatively good performance at Modern Healthcare Technology Holdings Limited (HKG:919) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 27 August 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Modern Healthcare Technology Holdings

How Does Total Compensation For Joyce Tsang Compare With Other Companies In The Industry?

According to our data, Modern Healthcare Technology Holdings Limited has a market capitalization of HK$214m, and paid its CEO total annual compensation worth HK$11m over the year to March 2021. We note that's an increase of 9.9% above last year. In particular, the salary of HK$10.8m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.3m. Accordingly, our analysis reveals that Modern Healthcare Technology Holdings Limited pays Joyce Tsang north of the industry median. Moreover, Joyce Tsang also holds HK$161m worth of Modern Healthcare Technology Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2021	2020	Proportion (2021)
Salary	HK$11m	HK$9.8m	99%
Other	HK$70k	HK$73k	1%
Total Compensation	HK$11m	HK$9.9m	100%

On an industry level, around 89% of total compensation represents salary and 11% is other remuneration. Modern Healthcare Technology Holdings has gone down a largely traditional route, paying Joyce Tsang a high salary, giving it preference over non-salary benefits. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Modern Healthcare Technology Holdings Limited's Growth

Modern Healthcare Technology Holdings Limited has seen its earnings per share (EPS) increase by 118% a year over the past three years. In the last year, its revenue is down 17%.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Modern Healthcare Technology Holdings Limited Been A Good Investment?

Modern Healthcare Technology Holdings Limited has generated a total shareholder return of 5.3% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

To Conclude...

Modern Healthcare Technology Holdings pays its CEO a majority of compensation through a salary. Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for Modern Healthcare Technology Holdings that investors should think about before committing capital to this stock.

Important note: Modern Healthcare Technology 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. 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.
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