Jianqiu Zhu is the CEO of Changhong Jiahua Holdings Limited (HKG:8016). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Jianqiu Zhu’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Changhong Jiahua Holdings Limited has a market cap of HK$1.4b, and is paying total annual CEO compensation of HK$12m. (This number is for the twelve months until December 2017). We think total compensation is more important but we note that the CEO salary is lower, at HK$1.2m. We looked at a group of companies with market capitalizations from HK$785m to HK$3.1b, and the median CEO total compensation was HK$1.7m.
Thus we can conclude that Jianqiu Zhu receives more in total compensation than the median of a group of companies in the same market, and of similar size to Changhong Jiahua Holdings Limited. 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.
You can see a visual representation of the CEO compensation at Changhong Jiahua Holdings, below.
Is Changhong Jiahua Holdings Limited Growing?
Over the last three years Changhong Jiahua Holdings Limited has grown its earnings per share (EPS) by an average of 9.9% per year (using a line of best fit). It achieved revenue growth of 4.6% over the last year.
I’d prefer higher revenue growth, but I’m happy with the modest EPS growth. So there are some positives here, but not enough to earn high praise. We don’t have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Changhong Jiahua Holdings Limited Been A Good Investment?
Since shareholders would have lost about 53% over three years, some Changhong Jiahua Holdings Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Changhong Jiahua Holdings Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Although we’d stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Changhong Jiahua Holdings.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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