Eddie Lam is the CEO of Thelloy Development Group Limited (HKG:1546). 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Eddie Lam's Compensation Compare With Similar Sized Companies?
Our data indicates that Thelloy Development Group Limited is worth HK$352m, and total annual CEO compensation was reported as HK$7.4m for the year to March 2019. We think total compensation is more important but we note that the CEO salary is lower, at HK$2.4m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We took a group of companies with market capitalizations below HK$1.6b, and calculated the median CEO total compensation to be HK$1.7m.
Thus we can conclude that Eddie Lam receives more in total compensation than the median of a group of companies in the same market, and of similar size to Thelloy Development Group 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 Thelloy Development Group, below.
Is Thelloy Development Group Limited Growing?
Thelloy Development Group Limited has increased its earnings per share (EPS) by an average of 50% a year, over the last three years (using a line of best fit). In the last year, its revenue is down 8.4%.
This demonstrates that the company has been improving recently. A good result. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Although we don't have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Thelloy Development Group Limited Been A Good Investment?
I think that the total shareholder return of 97%, over three years, would leave most Thelloy Development Group 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 Thelloy Development Group Limited pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However, the earnings per share growth over three years is certainly impressive. In addition, shareholders have done well over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Thelloy Development Group.
Important note: Thelloy Development Group 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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