Is Singapore Technologies Engineering Ltd's (SGX:S63) CEO Paid Enough Relative To Peers?
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Vincent Chong has been the CEO of Singapore Technologies Engineering Ltd (SGX:S63) since 2016. First, this article will compare CEO compensation with compensation at similar sized companies. 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 method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for Singapore Technologies Engineering
How Does Vincent Chong's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Singapore Technologies Engineering Ltd has a market cap of S$12b, and is paying total annual CEO compensation of S$4.6m. (This is based on the year to December 2018). Notably, that's an increase of 9.1% over the year before. We think total compensation is more important but we note that the CEO salary is lower, at S$973k. We looked at a group of companies with market capitalizations from S$5.4b to S$16b, and the median CEO total compensation was S$3.3m.
Thus we can conclude that Vincent Chong receives more in total compensation than the median of a group of companies in the same market, and of similar size to Singapore Technologies Engineering Ltd. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see a visual representation of the CEO compensation at Singapore Technologies Engineering, below.
Is Singapore Technologies Engineering Ltd Growing?
Over the last three years Singapore Technologies Engineering Ltd has grown its earnings per share (EPS) by an average of 1.5% per year (using a line of best fit). Its revenue is up 2.7% over last year.
I'm not particularly impressed by the revenue growth, but the modest improvement in EPS is good. Considering these factors I'd say performance has been pretty decent, though not amazing. Shareholders might be interested in this free visualization of analyst forecasts.
Has Singapore Technologies Engineering Ltd Been A Good Investment?
Most shareholders would probably be pleased with Singapore Technologies Engineering Ltd for providing a total return of 40% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
We compared the total CEO remuneration paid by Singapore Technologies Engineering Ltd, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
While we generally prefer to see stronger EPS growth, there's no arguing with the strong returns to shareholders, over the last three years. As a result of the juicy return to investors, the CEO remuneration may well be quite reasonable. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Singapore Technologies Engineering (free visualization of insider trades).
If you want to buy a stock that is better than Singapore Technologies Engineering, this free list of high return, low debt companies is a great place to look.
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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.
