The CEO of Want Want China Holdings Limited (HKG:151) is Eng-Meng Tsai. First, this article will compare CEO compensation with compensation at other large companies. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Eng-Meng Tsai's Compensation Compare With Similar Sized Companies?
Our data indicates that Want Want China Holdings Limited is worth HK$77b, and total annual CEO compensation was reported as CN¥81m for the year to March 2019. While we always look at total compensation first, we note that the salary component is less, at CN¥985k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We took a group of companies with market capitalizations over CN¥57b, and calculated the median CEO total compensation to be CN¥5.6m. (We took a wide range because the CEOs of massive companies tend to be paid similar amounts - even though some are quite a bit bigger than others).
Thus we can conclude that Eng-Meng Tsai receives more in total compensation than the median of a group of large companies in the same market as Want Want China Holdings Limited. 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 Want Want China Holdings, below.
Is Want Want China Holdings Limited Growing?
Want Want China Holdings Limited saw earnings per share stay pretty flat over the last three years, albeit with a slight positive trend. Its revenue is up 4.8% over last year.
I'm not particularly impressed by the revenue growth, but it is good to see modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. You might want to check this free visual report on analyst forecasts for future earnings.
Has Want Want China Holdings Limited Been A Good Investment?
I think that the total shareholder return of 43%, over three years, would leave most Want Want China Holdings Limited shareholders smiling. 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.
We examined the amount Want Want China Holdings Limited pays its CEO, and compared it to the amount paid by other large companies. We found that it pays well over the median amount paid in the benchmark 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. Whatever your view on compensation, you might want to check if insiders are buying or selling Want Want China Holdings shares (free trial).
If you want to buy a stock that is better than Want Want China Holdings, this free list of high return, low debt companies is a great place to look.
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