We Think Shareholders Are Less Likely To Approve A Pay Rise For Doumob's (HKG:1917) CEO For Now

Key Insights

• Doumob's Annual General Meeting to take place on 20th of June
• CEO Bin Yang's total compensation includes salary of CN¥1.08m
• The total compensation is similar to the average for the industry
• Doumob's EPS grew by 41% over the past three years while total shareholder loss over the past three years was 45%

The underwhelming share price performance of Doumob (HKG:1917) 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. The AGM coming up on the 20th of June could be an opportunity for shareholders to bring these concerns to the board's attention. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

See our latest analysis for Doumob

How Does Total Compensation For Bin Yang Compare With Other Companies In The Industry?

Our data indicates that Doumob has a market capitalization of HK$163m, and total annual CEO compensation was reported as CN¥3.0m for the year to December 2023. That's a fairly small increase of 3.7% over the previous year. We think total compensation is more important but our data shows that the CEO salary is lower, at CN¥1.1m.

For comparison, other companies in the Hong Kong Interactive Media and Services industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of CN¥3.0m. So it looks like Doumob compensates Bin Yang in line with the median for the industry. Moreover, Bin Yang also holds HK$52m worth of Doumob stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	CN¥1.1m	CN¥1.2m	36%
Other	CN¥1.9m	CN¥1.7m	64%
Total Compensation	CN¥3.0m	CN¥2.9m	100%

Speaking on an industry level, nearly 33% of total compensation represents salary, while the remainder of 67% is other remuneration. Doumob is paying a higher share of its remuneration through a salary in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Doumob's Growth

Over the past three years, Doumob has seen its earnings per share (EPS) grow by 41% per year. It achieved revenue growth of 47% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Doumob Been A Good Investment?

The return of -45% over three years would not have pleased Doumob shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

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 fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 3 warning signs for Doumob you should be aware of, and 2 of them are a bit concerning.

Switching gears from Doumob, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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.