What Does China Electronics Optics Valley Union Holding's (HKG:798) CEO Pay Reveal?

The CEO of China Electronics Optics Valley Union Holding Company Limited (HKG:798) is Liping Huang, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for China Electronics Optics Valley Union Holding

How Does Total Compensation For Liping Huang Compare With Other Companies In The Industry?

At the time of writing, our data shows that China Electronics Optics Valley Union Holding Company Limited has a market capitalization of HK$3.2b, and reported total annual CEO compensation of CN¥2.1m for the year to December 2019. That is, the compensation was roughly the same as last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CN¥552k.

For comparison, other companies in the same industry with market capitalizations ranging between HK$1.6b and HK$6.2b had a median total CEO compensation of CN¥3.2m. In other words, China Electronics Optics Valley Union Holding pays its CEO lower than the industry median. Moreover, Liping Huang also holds HK$806m worth of China Electronics Optics Valley Union Holding stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 70% of total compensation represents salary, while the remainder of 30% is other remuneration. China Electronics Optics Valley Union Holding pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at China Electronics Optics Valley Union Holding Company Limited's Growth Numbers

China Electronics Optics Valley Union Holding Company Limited's earnings per share (EPS) grew 4.7% per year over the last three years. It saw its revenue drop 6.9% over the last year.

We generally like to see a little revenue growth, but the modest EPSgrowth gives us some relief. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 China Electronics Optics Valley Union Holding Company Limited Been A Good Investment?

Since shareholders would have lost about 36% over three years, some China Electronics Optics Valley Union Holding Company Limited investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we noted earlier, China Electronics Optics Valley Union Holding pays its CEO lower than the norm for similar-sized companies belonging to the same industry. But then, EPS growth is lacking and so are the returns to shareholders. So while we don't think, Liping is paid too much, shareholders may hope that business performance translates to investment returns before pay rises are given out.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 3 warning signs for China Electronics Optics Valley Union Holding you should be aware of, and 1 of them is potentially serious.

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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