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Is Willas-Array Electronics (Holdings) Limited's (SGX:BDR) CEO Overpaid Relative To Its Peers?

Simply Wall St

Alvin Hon became the CEO of Willas-Array Electronics (Holdings) Limited (SGX:BDR) in 2014. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

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See our latest analysis for Willas-Array Electronics (Holdings)

How Does Alvin Hon's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Willas-Array Electronics (Holdings) Limited has a market cap of S$45m, and is paying total annual CEO compensation of HK$3.4m. (This figure is for the year to March 2018). We think total compensation is more important but we note that the CEO salary is lower, at HK$1.7m. 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$1.6m.

As you can see, Alvin Hon is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Willas-Array Electronics (Holdings) Limited is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

You can see, below, how CEO compensation at Willas-Array Electronics (Holdings) has changed over time.

SGX:BDR CEO Compensation, May 24th 2019

Is Willas-Array Electronics (Holdings) Limited Growing?

On average over the last three years, Willas-Array Electronics (Holdings) Limited has grown earnings per share (EPS) by 97% each year (using a line of best fit). Its revenue is up 4.5% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Willas-Array Electronics (Holdings) Limited Been A Good Investment?

With a total shareholder return of 8.9% over three years, Willas-Array Electronics (Holdings) Limited has done okay by shareholders. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

We compared the total CEO remuneration paid by Willas-Array Electronics (Holdings) Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. We also note that, over the same time frame, shareholder returns haven't been bad. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. So you may want to check if insiders are buying Willas-Array Electronics (Holdings) shares with their own money (free access).

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.