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Is YGM Trading Limited's (HKG:375) CEO Paid Enough Relative To Peers?

Simply Wall St

In 2015 William Fu was appointed CEO of YGM Trading Limited (HKG:375). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. 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.

View our latest analysis for YGM Trading

How Does William Fu's Compensation Compare With Similar Sized Companies?

According to our data, YGM Trading Limited has a market capitalization of HK$1.2b, and pays its CEO total annual compensation worth HK$7.3m. (This number is for the twelve months until March 2018). While we always look at total compensation first, we note that the salary component is less, at HK$2.1m. When we examined a selection of companies with market caps ranging from HK$782m to HK$3.1b, we found the median CEO total compensation was HK$2.1m.

As you can see, William Fu is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean YGM Trading Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at YGM Trading has changed over time.

SEHK:375 CEO Compensation, July 29th 2019

Is YGM Trading Limited Growing?

Over the last three years YGM Trading Limited has grown its earnings per share (EPS) by an average of 96% per year (using a line of best fit). In the last year, its revenue is down -37%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has YGM Trading Limited Been A Good Investment?

Most shareholders would probably be pleased with YGM Trading Limited for providing a total return of 205% 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...

We compared the total CEO remuneration paid by YGM Trading 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. On top of that, in the same period, returns to shareholders have been great. 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 YGM Trading.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.