What Does Taiwan Sakura's (TPE:9911) CEO Pay Reveal?

Yuo-Tu Lin has been the CEO of Taiwan Sakura Corporation (TPE:9911) since 2013, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Taiwan Sakura pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Taiwan Sakura

How Does Total Compensation For Yuo-Tu Lin Compare With Other Companies In The Industry?

At the time of writing, our data shows that Taiwan Sakura Corporation has a market capitalization of NT$12b, and reported total annual CEO compensation of NT$19m for the year to December 2019. That's a notable increase of 8.7% on last year. In particular, the salary of NT$15.5m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the industry with market capitalizations between NT$5.6b and NT$23b, we discovered that the median CEO total compensation of that group was NT$11m. This suggests that Yuo-Tu Lin is paid more than the median for the industry. Moreover, Yuo-Tu Lin also holds NT$87m worth of Taiwan Sakura stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 79% of total compensation out of all the companies we analyzed, while other remuneration made up 21% of the pie. Our data reveals that Taiwan Sakura allocates salary more or less in line with the wider market. 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.

Taiwan Sakura Corporation's Growth

Taiwan Sakura Corporation has seen its earnings per share (EPS) increase by 12% a year over the past three years. Its revenue is up 7.2% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Taiwan Sakura Corporation Been A Good Investment?

Boasting a total shareholder return of 68% over three years, Taiwan Sakura Corporation has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

As we noted earlier, Taiwan Sakura pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Importantly though, EPS growth and shareholder returns are very impressive over the last three years. Considering such exceptional results for the company, we'd venture to say CEO compensation is fair. And given most shareholders are probably very happy with recent returns, they might even think that Yuo-Tu deserves a raise!

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Taiwan Sakura that investors should think about before committing capital to this stock.

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.

When trading Taiwan Sakura 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.