Is China Investments Holdings Limited’s (HKG:132) CEO Being Overpaid?
In 2016 Pingwu Lin was appointed CEO of China Investments Holdings Limited (HKG:132). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for China Investments Holdings
How Does Pingwu Lin’s Compensation Compare With Similar Sized Companies?
Our data indicates that China Investments Holdings Limited is worth HK$719m, and total annual CEO compensation is HK$1.8m. We note that’s an increase of 42% above last year. We examined a group of similar sized companies, with market capitalizations of below HK$1.6b. The median CEO compensation in that group is HK$1.7m.
So Pingwu Lin receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.
The graphic below shows how CEO compensation at China Investments Holdings has changed from year to year.
Is China Investments Holdings Limited Growing?
China Investments Holdings Limited has reduced its earnings per share by an average of 65% a year, over the last three years. Its revenue is up 115% over last year.
The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. It’s hard to reach a conclusion about business performance right now. This may be one to watch.
Although we don’t have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has China Investments Holdings Limited Been A Good Investment?
Given the total loss of 44% over three years, many shareholders in China Investments Holdings Limited are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary…
Pingwu Lin is paid around the same as most CEOs of similar size companies.
We would like to see somewhat stronger per share growth. And shareholder returns have been disappointing over the last three years. This contrasts with the growth in CEO remuneration. So it would take a bold person to suggest the pay is too modest.
Or you might prefer this data-rich interactive visualization of historic revenue and earnings.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
