In 2008 Raymond Kwok was appointed CEO of Sun Hung Kai Properties Limited (HKG:16). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Raymond Kwok's Compensation Compare With Similar Sized Companies?
Our data indicates that Sun Hung Kai Properties Limited is worth HK$339b, and total annual CEO compensation was reported as HK$3.9m for the year to June 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at HK$2.7m. We took a group of companies with market capitalizations over HK$62b, and calculated the median CEO total compensation to be HK$7.3m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
A first glance this seems like a real positive for shareholders, since Raymond Kwok is paid less than the average total compensation paid by other large companies. Though positive, it's important we delve into the performance of the actual business.
You can see, below, how CEO compensation at Sun Hung Kai Properties has changed over time.
Is Sun Hung Kai Properties Limited Growing?
Sun Hung Kai Properties Limited has increased its earnings per share (EPS) by an average of 6.4% a year, over the last three years (using a line of best fit). In the last year, its revenue changed by just 0.4%.
I would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. You might want to check this free visual report on analyst forecasts for future earnings.
Has Sun Hung Kai Properties Limited Been A Good Investment?
With a total shareholder return of 24% over three years, Sun Hung Kai Properties Limited shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
It appears that Sun Hung Kai Properties Limited remunerates its CEO below most large companies.
Raymond Kwok is paid less than what is normal at large companies, and but overall performance has left me uninspired. But on this analysis I see no issue with the CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Sun Hung Kai Properties (free visualization of insider trades).
Important note: Sun Hung Kai Properties 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.
If you spot an error that warrants correction, please contact the editor at email@example.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.