Fenglei Liu became the CEO of China Harmony New Energy Auto Holding Limited (HKG:3836) in 2015. 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.
How Does Fenglei Liu's Compensation Compare With Similar Sized Companies?
According to our data, China Harmony New Energy Auto Holding Limited has a market capitalization of HK$3.2b, and pays its CEO total annual compensation worth CN¥1.7m. (This is based on the year to December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at CN¥750k. We looked at a group of companies with market capitalizations from CN¥1.4b to CN¥5.6b, and the median CEO total compensation was CN¥2.2m.
That means Fenglei Liu receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at China Harmony New Energy Auto Holding, below.
Is China Harmony New Energy Auto Holding Limited Growing?
On average over the last three years, China Harmony New Energy Auto Holding Limited has grown earnings per share (EPS) by 33% each year (using a line of best fit). Its revenue is down -1.9% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. It could be important to check this free visual depiction of what analysts expect for the future.
Has China Harmony New Energy Auto Holding Limited Been A Good Investment?
Since shareholders would have lost about 49% over three years, some China Harmony New Energy Auto Holding Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
Fenglei Liu is paid around what is normal the leaders of comparable size companies.
We think that the EPS growth is very pleasing, but it's disappointing to see negative shareholder returns over three years. Considering the the positives we don't think the CEO pays is too high, but it's certainly hard to argue it is too low. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling China Harmony New Energy Auto Holding (free visualization of insider trades).
If you want to buy a stock that is better than China Harmony New Energy Auto Holding, this free list of high return, low debt companies is a great place to look.
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