Does Modern Beauty Salon Holdings Limited's (HKG:919) CEO Salary Compare Well With Others?
In 2010 Joyce Tsang was appointed CEO of Modern Beauty Salon Holdings Limited (HKG:919). 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. This method should give us information to assess how appropriately the company pays the CEO.
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See our latest analysis for Modern Beauty Salon Holdings
How Does Joyce Tsang's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Modern Beauty Salon Holdings Limited has a market cap of HK$181m, and is paying total annual CEO compensation of HK$11m. (This number is for the twelve months until March 2018). Notably, the salary of HK$11m is the vast majority of the CEO compensation. We took a group of companies with market capitalizations below HK$1.6b, and calculated the median CEO total compensation to be HK$1.5m.
As you can see, Joyce Tsang is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Modern Beauty Salon Holdings 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 Modern Beauty Salon Holdings has changed over time.
Is Modern Beauty Salon Holdings Limited Growing?
Modern Beauty Salon Holdings Limited has reduced its earnings per share by an average of 81% a year, over the last three years (measured with a line of best fit). Its revenue is down -12% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Modern Beauty Salon Holdings Limited Been A Good Investment?
Since shareholders would have lost about 53% over three years, some Modern Beauty Salon Holdings Limited shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
We compared the total CEO remuneration paid by Modern Beauty Salon Holdings Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Arguably worse, investors are without a positive return for the last three years. In our opinion the CEO might be paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Modern Beauty Salon Holdings (free visualization of insider trades).
If you want to buy a stock that is better than Modern Beauty Salon Holdings, this free list of high return, low debt companies is a great place to look.
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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.
