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Is Vongroup Limited's (HKG:318) CEO Paid Enough Relative To Peers?

Simply Wall St

David Vong has been the CEO of Vongroup Limited (HKG:318) since 2005. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for Vongroup

How Does David Vong's Compensation Compare With Similar Sized Companies?

According to our data, Vongroup Limited has a market capitalization of HK$81m, and pays its CEO total annual compensation worth HK$1.7m. (This is based on the year to April 2018). While we always look at total compensation first, we note that the salary component is less, at HK$600k. We examined a group of similar sized companies, with market capitalizations of below HK$1.6b. The median CEO total compensation in that group is HK$1.8m.

That means David Vong receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.

You can see a visual representation of the CEO compensation at Vongroup, below.

SEHK:318 CEO Compensation, July 31st 2019

Is Vongroup Limited Growing?

Over the last three years Vongroup Limited has grown its earnings per share (EPS) by an average of 77% per year (using a line of best fit). In the last year, its revenue is up 159%.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Vongroup Limited Been A Good Investment?

Since shareholders would have lost about 64% over three years, some Vongroup Limited shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

David Vong is paid around what is normal the leaders of comparable size companies.

We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. We'd be surprised if shareholders want to see a pay rise for the CEO, but we'd stop short of calling their pay too generous. Shareholders may want to check for free if Vongroup insiders are buying or selling shares.

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.

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.