Zhisuo Ding is the CEO of CMBC Capital Holdings Limited (HKG:1141). 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 - 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.
How Does Zhisuo Ding's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that CMBC Capital Holdings Limited has a market cap of HK$6.0b, and reported total annual CEO compensation of HK$3.9m for the year to December 2018. Notably, the salary of HK$3.9m is the vast majority of the CEO compensation. We examined companies with market caps from HK$3.1b to HK$12b, and discovered that the median CEO total compensation of that group was HK$3.8m.
So Zhisuo Ding receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see, below, how CEO compensation at CMBC Capital Holdings has changed over time.
Is CMBC Capital Holdings Limited Growing?
Over the last three years CMBC Capital Holdings Limited has grown its earnings per share (EPS) by an average of 90% per year (using a line of best fit). It achieved revenue growth of 56% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has CMBC Capital Holdings Limited Been A Good Investment?
With a three year total loss of 60%, CMBC Capital Holdings Limited would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Zhisuo Ding is paid around the same as most CEOs of similar size companies.
We'd say the company can boast of its EPS growth, but we cannot say the same about the lacklustre shareholder returns (over the last three years). Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at CMBC Capital Holdings.
Important note: CMBC Capital Holdings may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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