How Should Investors React To Vinco Financial Group Limited's (HKG:8340) CEO Pay?

Simply Wall St

Alister Chung is the CEO of Vinco Financial Group Limited (HKG:8340). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. 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.

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

Check out our latest analysis for Vinco Financial Group

How Does Alister Chung's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Vinco Financial Group Limited has a market cap of HK$58m, and is paying total annual CEO compensation of HK$3.4m. (This is based on the year to December 2018). That's less than last year. It is worth noting that the CEO compensation consists almost entirely of the salary, worth HK$3.4m. 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$1.5m.

It would therefore appear that Vinco Financial Group Limited pays Alister Chung more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at Vinco Financial Group, below.

SEHK:8340 CEO Compensation, May 23rd 2019

Is Vinco Financial Group Limited Growing?

Over the last three years Vinco Financial Group Limited has grown its earnings per share (EPS) by an average of 26% per year (using a line of best fit). In the last year, its revenue is down -54%.

This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important. 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 Vinco Financial Group Limited Been A Good Investment?

Given the total loss of 95% over three years, many shareholders in Vinco Financial Group Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

We examined the amount Vinco Financial Group Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

However we must not forget that the EPS growth has been very strong over three years. However, the returns to investors are far less impressive, over the same period. Considering the per share profit growth, but keeping in mind the weak returns, we'd need more time to form a view on CEO compensation. So you may want to check if insiders are buying Vinco Financial Group shares with their own money (free access).

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.