What We Learned About Overseas Education's (SGX:RQ1) CEO Compensation

David Alan Perry is the CEO of Overseas Education Limited (SGX:RQ1), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Overseas Education

Comparing Overseas Education Limited's CEO Compensation With the industry

At the time of writing, our data shows that Overseas Education Limited has a market capitalization of S$129m, and reported total annual CEO compensation of S$383k for the year to December 2019. We note that's an increase of 13% above last year. Notably, the salary which is S$377.6k, represents most of the total compensation being paid.

For comparison, other companies in the industry with market capitalizations below S$266m, reported a median total CEO compensation of S$146k. This suggests that David Alan Perry is paid more than the median for the industry. Moreover, David Alan Perry also holds S$42m worth of Overseas Education stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 92% of total compensation represents salary and 8.0% is other remuneration. Overseas Education has gone down a largely traditional route, paying David Alan Perry a high salary, giving it preference over non-salary benefits. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Overseas Education Limited's Growth

Overseas Education Limited has seen its earnings per share (EPS) increase by 28% a year over the past three years. Its revenue is up 1.3% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Overseas Education Limited Been A Good Investment?

Overseas Education Limited has not done too badly by shareholders, with a total return of 4.7%, over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

David Alan receives almost all of their compensation through a salary. As we noted earlier, Overseas Education pays its CEO higher than the norm for similar-sized companies belonging to the same industry. But the company has impressed us with its EPS growth, over three years. We also think investor returns are steady over the same time period. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn't say CEO compensation problematic.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 4 warning signs for Overseas Education (3 are significant!) that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

When trading Overseas Education or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on 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.