Jay Chun became the CEO of Paradise Entertainment Limited (HKG:1180) in 1999. 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Jay Chun's Compensation Compare With Similar Sized Companies?
Our data indicates that Paradise Entertainment Limited is worth HK$936m, and total annual CEO compensation was reported as HK$13m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at HK$12m. We looked at a group of companies with market capitalizations under HK$1.6b, and the median CEO total compensation was HK$1.7m.
Thus we can conclude that Jay Chun receives more in total compensation than the median of a group of companies in the same market, and of similar size to Paradise Entertainment Limited. However, this doesn't necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Paradise Entertainment has changed from year to year.
Is Paradise Entertainment Limited Growing?
On average over the last three years, Paradise Entertainment Limited has grown earnings per share (EPS) by 133% each year (using a line of best fit). In the last year, its revenue is up 9.7%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Paradise Entertainment Limited Been A Good Investment?
Since shareholders would have lost about 44% over three years, some Paradise Entertainment Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
We examined the amount Paradise Entertainment 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. Having said that, shareholders may be disappointed with the weak returns over the last three years. While EPS is positive, we'd say shareholders would want better returns before the CEO is paid much more. Whatever your view on compensation, you might want to check if insiders are buying or selling Paradise Entertainment shares (free trial).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.