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Jianxing Che has been the CEO of Red Star Macalline Group Corporation Ltd. (HKG:1528) since 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Jianxing Che’s Compensation Compare With Similar Sized Companies?
Our data indicates that Red Star Macalline Group Corporation Ltd. is worth HK$43b, and total annual CEO compensation is CN¥8.4m. (This number is for the twelve months until December 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at CN¥6.6m. We examined companies with market caps from CN¥27b to CN¥82b, and discovered that the median CEO total compensation of that group was CN¥2.6m.
Thus we can conclude that Jianxing Che receives more in total compensation than the median of a group of companies in the same market, and of similar size to Red Star Macalline Group Corporation Ltd.. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
The graphic below shows how CEO compensation at Red Star Macalline Group has changed from year to year.
Is Red Star Macalline Group Corporation Ltd. Growing?
Red Star Macalline Group Corporation Ltd. has increased its earnings per share (EPS) by an average of 14% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 29%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. You might want to check this free visual report on analyst forecasts for future earnings.
Has Red Star Macalline Group Corporation Ltd. Been A Good Investment?
Given the total loss of 4.7% over three years, many shareholders in Red Star Macalline Group Corporation Ltd. are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We compared total CEO remuneration at Red Star Macalline Group Corporation Ltd. with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
Importantly, though, the company has impressed with its earnings per share growth, over three years. On the other hand returns to investors over the same period have probably disappointed many. While EPS is positive, we’d say shareholders would want better returns before the CEO is paid much more. So you may want to check if insiders are buying Red Star Macalline Group shares with their own money (free access).
Important note: Red Star Macalline Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.