Danyun Chen became the CEO of Fujian Holdings Limited (HKG:181) in 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Fujian Holdings
How Does Danyun Chen's Compensation Compare With Similar Sized Companies?
According to our data, Fujian Holdings Limited has a market capitalization of HK$155m, and paid its CEO total annual compensation worth HK$710k over the year to December 2018. It is worth noting that the CEO compensation consists almost entirely of the salary, worth HK$710k. 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$1.8m.
A first glance this seems like a real positive for shareholders, since Danyun Chen 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.
The graphic below shows how CEO compensation at Fujian Holdings has changed from year to year.
Is Fujian Holdings Limited Growing?
Fujian Holdings Limited has increased its earnings per share (EPS) by an average of 59% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 11%.
This demonstrates that the company has been improving recently. A good result. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Although we don't have analyst forecasts shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Fujian Holdings Limited Been A Good Investment?
Since shareholders would have lost about 67% over three years, some Fujian Holdings Limited shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
It appears that Fujian Holdings Limited remunerates its CEO below most similar sized companies.
Since the business is growing, many would argue this suggests the pay is modest. Despite some positives, it is likely that shareholders wanted better returns, given the performance over the last three years. So while we would not say that Danyun Chen is generously paid, it would be good to see an improvement in business performance before too an increase in pay. When I see fairly low remuneration, combined with earnings per share growth, but without big share price gains, it makes me want to research the potential for future gains. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Fujian Holdings.
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.
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