Hai Li has been the CEO of Shenzhen International Holdings Limited (HKG:152) since 2016. First, this article will compare CEO compensation with compensation at similar sized 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 Hai Li's Compensation Compare With Similar Sized Companies?
According to our data, Shenzhen International Holdings Limited has a market capitalization of HK$36b, and paid its CEO total annual compensation worth HK$1.6m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at HK$283k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of HK$16b to HK$50b. The median total CEO compensation was HK$4.0m.
A first glance this seems like a real positive for shareholders, since Hai Li is paid less than the average total compensation paid by similar sized companies. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Shenzhen International Holdings has changed over time.
Is Shenzhen International Holdings Limited Growing?
On average over the last three years, Shenzhen International Holdings Limited has grown earnings per share (EPS) by 29% each year (using a line of best fit). It achieved revenue growth of 8.0% over the last year.
This demonstrates that the company has been improving recently. A good result. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. Shareholders might be interested in this free visualization of analyst forecasts.
Has Shenzhen International Holdings Limited Been A Good Investment?
Most shareholders would probably be pleased with Shenzhen International Holdings Limited for providing a total return of 67% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
Shenzhen International Holdings Limited is currently paying its CEO below what is normal for companies of its size.
Since the business is growing, many would argue this suggests the pay is modest. The strong history of shareholder returns might even have some thinking that Hai Li deserves a raise! It's not often we see shareholders do so well, and yet the CEO is paid modestly. It would be even more positive if company insiders are buying shares. Whatever your view on compensation, you might want to check if insiders are buying or selling Shenzhen International Holdings shares (free trial).
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.
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