Does Hong Kong Ferry (Holdings) Company Limited's (HKG:50) CEO Pay Reflect Performance?
David Ho has been the CEO of Hong Kong Ferry (Holdings) Company Limited (HKG:50) since 1996. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Hong Kong Ferry (Holdings)
How Does David Ho's Compensation Compare With Similar Sized Companies?
According to our data, Hong Kong Ferry (Holdings) Company Limited has a market capitalization of HK$2.4b, and paid its CEO total annual compensation worth HK$3.7m over the year to December 2018. Notably, the salary of HK$3.7m is the vast majority of the CEO compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of HK$1.6b to HK$6.2b. The median total CEO compensation was HK$2.6m.
As you can see, David Ho is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Hong Kong Ferry (Holdings) Company Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Hong Kong Ferry (Holdings), below.
Is Hong Kong Ferry (Holdings) Company Limited Growing?
On average over the last three years, Hong Kong Ferry (Holdings) Company Limited has grown earnings per share (EPS) by 9.6% each year (using a line of best fit). Its revenue is down 71% over last year.
I would argue that the lack of revenue growth in the last year is less than ideal, but the improvement in EPS is good. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Hong Kong Ferry (Holdings) Company Limited Been A Good Investment?
Since shareholders would have lost about 16% over three years, some Hong Kong Ferry (Holdings) Company Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
We compared the total CEO remuneration paid by Hong Kong Ferry (Holdings) Company Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. Shareholders may want to check for free if Hong Kong Ferry (Holdings) insiders are buying or selling shares.
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.
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.
