How Should Investors React To Tianneng Power International Limited's (HKG:819) CEO Pay?
The CEO of Tianneng Power International Limited (HKG:819) is Tianren Zhang. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Tianneng Power International
How Does Tianren Zhang's Compensation Compare With Similar Sized Companies?
According to our data, Tianneng Power International Limited has a market capitalization of HK$8.7b, and pays its CEO total annual compensation worth CN¥1.5m. (This is based on the year to December 2017). It is worth noting that the CEO compensation consists almost entirely of the salary, worth CN¥1.5m. When we examined a selection of companies with market caps ranging from CN¥2.7b to CN¥11b, we found the median CEO total compensation was CN¥2.7m.
Most shareholders would consider it a positive that Tianren Zhang takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. 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 Tianneng Power International has changed from year to year.
Is Tianneng Power International Limited Growing?
Over the last three years Tianneng Power International Limited has grown its earnings per share (EPS) by an average of 24% per year (using a line of best fit). Its revenue is up 28% over last year.
This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Tianneng Power International Limited Been A Good Investment?
Tianneng Power International Limited has served shareholders reasonably well, with a total return of 11% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
In Summary...
It looks like Tianneng Power International Limited pays its CEO less than similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. While returns over the last few years haven't been top notch, there is nothing to suggest to us that Tianren Zhang is overcompensated.
It's good to see reasonable payment of the CEO, even while the business improves. But for me, it's even better if insiders are also buying shares with their own cold, hard, cash. Shareholders may want to check for free if Tianneng Power International insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.
