Rare Earth Magnesium Technology Group Holdings Limited's (HKG:601) CEO Compensation Looks Acceptable To Us And Here's Why

Key Insights

• Rare Earth Magnesium Technology Group Holdings to hold its Annual General Meeting on 30th of June
• Total pay for CEO Sai Chit Shum includes HK$600.0k salary
• The total compensation is 39% less than the average for the industry
• Rare Earth Magnesium Technology Group Holdings' EPS grew by 14% over the past three years while total shareholder loss over the past three years was 87%

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

Shareholders may be wondering what CEO Sai Chit Shum plans to do to improve the less than great performance at Rare Earth Magnesium Technology Group Holdings Limited (HKG:601) recently. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 30th of June. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We think CEO compensation looks appropriate given the data we have put together.

See our latest analysis for Rare Earth Magnesium Technology Group Holdings

How Does Total Compensation For Sai Chit Shum Compare With Other Companies In The Industry?

According to our data, Rare Earth Magnesium Technology Group Holdings Limited has a market capitalization of HK$47m, and paid its CEO total annual compensation worth HK$600k over the year to December 2024. This was the same as last year. It is worth noting that the CEO compensation consists entirely of the salary, worth HK$600k.

In comparison with other companies in the Hong Kong Metals and Mining industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$985k. Accordingly, Rare Earth Magnesium Technology Group Holdings pays its CEO under the industry median.

Talking in terms of the industry, salary represented approximately 83% of total compensation out of all the companies we analyzed, while other remuneration made up 17% of the pie. At the company level, Rare Earth Magnesium Technology Group Holdings pays Sai Chit Shum solely through a salary, preferring to go down a conventional route. 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.

A Look at Rare Earth Magnesium Technology Group Holdings Limited's Growth Numbers

Rare Earth Magnesium Technology Group Holdings Limited's earnings per share (EPS) grew 14% per year over the last three years. It saw its revenue drop 7.9% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Rare Earth Magnesium Technology Group Holdings Limited Been A Good Investment?

With a total shareholder return of -87% over three years, Rare Earth Magnesium Technology Group Holdings Limited shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Rare Earth Magnesium Technology Group Holdings pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. The fact that shareholders have earned a negative share price return is certainly disconcerting. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. There needs to be more focus by management and the board to examine why the share price has diverged from fundamentals. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board’s judgement and decision-making is aligned with their expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Rare Earth Magnesium Technology Group Holdings that you should be aware of before investing.

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.