Shenping Yin has been the CEO of Recon Technology, Ltd. (NASDAQ:RCON) since 2007. 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 - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Shenping Yin's Compensation Compare With Similar Sized Companies?
Our data indicates that Recon Technology, Ltd. is worth US$15m, and total annual CEO compensation was reported as CN¥278k for the year to June 2019. Notably, that's an increase of 85% over the year before. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at CN¥120k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$506k.
Most shareholders would consider it a positive that Shenping Yin takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
The graphic below shows how CEO compensation at Recon Technology has changed from year to year.
Is Recon Technology, Ltd. Growing?
Recon Technology, Ltd. has increased its earnings per share (EPS) by an average of 42% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 21%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Recon Technology, Ltd. Been A Good Investment?
Since shareholders would have lost about 64% over three years, some Recon Technology, Ltd. shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
Recon Technology, Ltd. is currently paying its CEO below what is normal for companies of its size.
Many would consider this to indicate that the pay is modest since the business is growing. Despite some positives, it is likely that shareholders wanted better returns, given the performance over the last three years. So while we don't think, Shenping Yin is paid too much, shareholders may hope that business performance translates to investment returns before pay rises are given out. This sort of circumstance certainly justifies further research, because the investment returns might still come in the future. Shareholders may want to check for free if Recon Technology insiders are buying or selling shares.
Important note: Recon Technology may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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