Here's What We Learned About The CEO Pay At Synertone Communication Corporation (HKG:1613)

Weining Han has been the CEO of Synertone Communication Corporation (HKG:1613) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Synertone Communication.

See our latest analysis for Synertone Communication

Comparing Synertone Communication Corporation's CEO Compensation With the industry

At the time of writing, our data shows that Synertone Communication Corporation has a market capitalization of HK$226m, and reported total annual CEO compensation of HK$1.8m for the year to March 2020. That's mostly flat as compared to the prior year's compensation. We note that the salary portion, which stands at HK$1.44m constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.9m. From this we gather that Weining Han is paid around the median for CEOs in the industry. What's more, Weining Han holds HK$54m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 77% of total compensation out of all the companies we analyzed, while other remuneration made up 23% of the pie. There isn't a significant difference between Synertone Communication and the broader market, in terms of salary allocation in the overall compensation package. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Synertone Communication Corporation's Growth Numbers

Synertone Communication Corporation has seen its earnings per share (EPS) increase by 79% a year over the past three years. In the last year, its revenue is down 11%.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. 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 Synertone Communication Corporation Been A Good Investment?

Since shareholders would have lost about 51% over three years, some Synertone Communication Corporation investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As previously discussed, Weining is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, shareholder returns paint a sorry picture for the company, finishing in the red over the last three years. But on the bright side, EPS growth is positive over the same period. It's tough for us to say CEO compensation is too generous when EPS growth is positive, but negative investor returns will irk shareholders and reduce any chances of a raise.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 4 warning signs for Synertone Communication you should be aware of, and 1 of them is concerning.

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.

If you’re looking to trade Synertone Communication, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.