A Quick Analysis On Infinity Development Holdings' (HKG:640) CEO Salary

The CEO of Infinity Development Holdings Company Limited (HKG:640) is Un Ieong, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Infinity Development Holdings.

Check out our latest analysis for Infinity Development Holdings

Comparing Infinity Development Holdings Company Limited's CEO Compensation With the industry

Our data indicates that Infinity Development Holdings Company Limited has a market capitalization of HK$355m, and total annual CEO compensation was reported as HK$9.0m for the year to September 2020. Notably, that's an increase of 77% over the year before. Notably, the salary which is HK$4.54m, represents most of the total compensation being paid.

For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.5m. This suggests that Un Ieong is paid more than the median for the industry. Moreover, Un Ieong also holds HK$270m worth of Infinity Development Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 55% of total compensation represents salary and 45% is other remuneration. Although there is a difference in how total compensation is set, Infinity Development Holdings more or less reflects the market in terms of setting the salary. 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.

Infinity Development Holdings Company Limited's Growth

Over the past three years, Infinity Development Holdings Company Limited has seen its earnings per share (EPS) grow by 77% per year. In the last year, its revenue is down 21%.

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. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Infinity Development Holdings Company Limited Been A Good Investment?

Since shareholders would have lost about 1.7% over three years, some Infinity Development Holdings Company Limited investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As we touched on above, Infinity Development Holdings Company Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the EPS growth is certainly impressive, but it's disappointing to see negative shareholder returns over the same period. Although we'd stop short of calling it inappropriate, we think Un is earning a very handsome sum.

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 Infinity Development Holdings that investors should think about before committing capital to this stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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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