Is Chinasoft International Limited's (HKG:354) CEO Overpaid Relative To Its Peers?
Henry Chen is the CEO of Chinasoft International Limited (HKG:354). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Chinasoft International
How Does Henry Chen's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Chinasoft International Limited has a market cap of HK$13b, and reported total annual CEO compensation of CN¥8.0m for the year to December 2018. Notably, the salary of CN¥8.0m is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations from CN¥7.0b to CN¥22b, and the median CEO total compensation was CN¥3.9m.
As you can see, Henry Chen is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Chinasoft International Limited is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Chinasoft International has changed over time.
Is Chinasoft International Limited Growing?
Chinasoft International Limited has increased its earnings per share (EPS) by an average of 19% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 14%.
This demonstrates that the company has been improving recently. A good result. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has Chinasoft International Limited Been A Good Investment?
Chinasoft International Limited has served shareholders reasonably well, with a total return of 31% 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.
In Summary...
We examined the amount Chinasoft International Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. We also think investors are doing ok, over the same time period. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. Shareholders may want to check for free if Chinasoft International insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
