Does Minmetals Land Limited’s (HKG:230) CEO Pay Matter?

Jianbo He has been the CEO of Minmetals Land Limited (HKG:230) since 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Minmetals Land

How Does Jianbo He’s Compensation Compare With Similar Sized Companies?

Our data indicates that Minmetals Land Limited is worth HK$4.0b, and total annual CEO compensation is HK$5m. That’s just a smallish increase of 3.0% on last year. When we examined a selection of companies with market caps ranging from HK$1.6b to HK$6.3b, we found the median CEO compensation was HK$2m.

Thus we can conclude that Jianbo He receives more in total compensation than the median of a group of companies in the same market, and of similar size to Minmetals Land Limited. However, this doesn’t necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

The graphic below shows how CEO compensation at Minmetals Land has changed from year to year.

SEHK:230 CEO Compensation October 27th 18
SEHK:230 CEO Compensation October 27th 18

Is Minmetals Land Limited Growing?

Minmetals Land Limited has increased its earnings per share (EPS) by an average of 38% a year, over the last three years It achieved revenue growth of 11% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Although we don’t have analyst forecasts, shareholders might want to examine this free detailed historical graph of earnings, revenue and cash flow.

Has Minmetals Land Limited Been A Good Investment?

Boasting a total shareholder return of 61% over three years, Minmetals Land Limited has done well by shareholders. This strong performance might mean some shareholders don’t mind if the CEO is paid more than is normal for a company of its size.

In Summary…

We compared the total CEO remuneration paid by Minmetals Land Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However, the earnings per share growth over three years is certainly impressive. On top of that, in the same period, returns to shareholders have been great. As a result of this good performance, the CEO remuneration may well be quite reasonable. Sometimes, highly paid CEOs create a lot of value for shareholders. Still, shareholders might want to check if insiders have been selling.

But note: Minmetals Land may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.