Is Yantai North Andre Juice Company Limited's (HKG:2218) CEO Pay Justified?
Hui Zhang has been the CEO of Yantai North Andre Juice Company Limited (HKG:2218) since 2009. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for Yantai North Andre Juice
How Does Hui Zhang's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Yantai North Andre Juice Company Limited has a market cap of HK$1.7b, and is paying total annual CEO compensation of CN¥336k. (This is based on the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at CN¥271k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of CN¥670m to CN¥2.7b. The median total CEO compensation was CN¥1.5m.
A first glance this seems like a real positive for shareholders, since Hui Zhang is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Yantai North Andre Juice has changed over time.
Is Yantai North Andre Juice Company Limited Growing?
Yantai North Andre Juice Company Limited has increased its earnings per share (EPS) by an average of 11% a year, over the last three years (using a line of best fit). Its revenue is up 18% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Yantai North Andre Juice Company Limited Been A Good Investment?
Most shareholders would probably be pleased with Yantai North Andre Juice Company Limited for providing a total return of 74% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
It appears that Yantai North Andre Juice Company Limited remunerates its CEO below most similar sized companies. Since the business is growing, many would argue this suggests the pay is modest. The pleasing shareholder returns are the cherry on top; you might even consider that Hui Zhang deserves a raise!
It's not often we see shareholders do so well, and yet the CEO is paid modestly. It would be even more positive if company insiders are buying shares. So you may want to check if insiders are buying Yantai North Andre Juice 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.
