How Should Investors Feel About Baofeng Modern International Holdings Company Limited's (HKG:1121) CEO Pay?
In 2013 Jingdong Zheng was appointed CEO of Baofeng Modern International Holdings Company Limited (HKG:1121). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
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View our latest analysis for Baofeng Modern International Holdings
How Does Jingdong Zheng's Compensation Compare With Similar Sized Companies?
According to our data, Baofeng Modern International Holdings Company Limited has a market capitalization of HK$803m, and pays its CEO total annual compensation worth CN¥1.4m. (This number is for the twelve months until December 2017). We think total compensation is more important but we note that the CEO salary is lower, at CN¥564k. We took a group of companies with market capitalizations below CN¥1.4b, and calculated the median CEO total compensation to be CN¥1.3m.
So Jingdong Zheng is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see a visual representation of the CEO compensation at Baofeng Modern International Holdings, below.
Is Baofeng Modern International Holdings Company Limited Growing?
On average over the last three years, Baofeng Modern International Holdings Company Limited has shrunk earnings per share by 46% each year (measured with a line of best fit). It achieved revenue growth of 31% over the last year.
Investors should note that, over three years, earnings per share are down. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Baofeng Modern International Holdings Company Limited Been A Good Investment?
Since shareholders would have lost about 26% over three years, some Baofeng Modern International Holdings Company Limited shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Remuneration for Jingdong Zheng is close enough to the median pay for a CEO of a similar sized company .
We would like to see somewhat stronger per share growth. And we think the shareholder returns - over three years - have been underwhelming. So many would argue that the CEO is certainly not underpaid. So you may want to check if insiders are buying Baofeng Modern International Holdings shares with their own money (free access).
If you want to buy a stock that is better than Baofeng Modern International Holdings, this free list of high return, low debt companies is a great place to look.
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.
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. Thank you for reading.
