Is Tianneng Power International Limited's (HKG:819) CEO Pay Fair?
The CEO of Tianneng Power International Limited (HKG:819) is Tianren Zhang. 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Tianneng Power International
How Does Tianren Zhang's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Tianneng Power International Limited has a market cap of HK$6.2b, and reported total annual CEO compensation of CN¥1.6m for the year to December 2018. Notably, the salary of CN¥1.5m is the vast majority of the CEO compensation. When we examined a selection of companies with market caps ranging from CN¥2.9b to CN¥11b, we found the median CEO total compensation was CN¥3.0m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. Though positive, it's important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at Tianneng Power International has changed from year to year.
Is Tianneng Power International Limited Growing?
Over the last three years Tianneng Power International Limited has grown its earnings per share (EPS) by an average of 19% per year (using a line of best fit). In the last year, its revenue is up 34%.
This demonstrates that the company has been improving recently. A good result. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Shareholders might be interested in this free visualization of analyst forecasts.
Has Tianneng Power International Limited Been A Good Investment?
Since shareholders would have lost about 8.9% over three years, some Tianneng Power International Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
It looks like Tianneng Power International Limited pays its CEO less than similar sized companies.
Many would consider this to indicate that the pay is modest since the business is growing. Unfortunately, some shareholders may be disappointed with their returns, given the company's performance over the last three years. We're not critical of the remuneration Tianren Zhang receives, but it would be good to see improved returns to shareholders before the remuneration grows too much. When I see fairly low remuneration, combined with earnings per share growth, but without big share price gains, it makes me want to research the potential for future gains. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Tianneng Power International (free visualization of insider trades).
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 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.
