In 2007 Jianxing Che was appointed CEO of Red Star Macalline Group Corporation Ltd. (HKG:1528). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Jianxing Che's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Red Star Macalline Group Corporation Ltd. has a market cap of HK$40b, and reported total annual CEO compensation of CN¥3.5m for the year to December 2018. Notably, the salary of CN¥3.4m is the vast majority of the CEO compensation. We examined companies with market caps from CN¥28b to CN¥85b, and discovered that the median CEO total compensation of that group was CN¥5.3m.
A first glance this seems like a real positive for shareholders, since Jianxing Che is paid less than the average total compensation paid by similar sized companies. However, before we heap on the praise, we should delve deeper to understand business performance.
The graphic below shows how CEO compensation at Red Star Macalline Group has changed from year to year.
Is Red Star Macalline Group Corporation Ltd. Growing?
Red Star Macalline Group Corporation Ltd. has increased its earnings per share (EPS) by an average of 12% a year, over the last three years (using a line of best fit). It achieved revenue growth of 27% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. You might want to check this free visual report on analyst forecasts for future earnings.
Has Red Star Macalline Group Corporation Ltd. Been A Good Investment?
Red Star Macalline Group Corporation Ltd. has generated a total shareholder return of 1.6% over three years, so most shareholders wouldn't be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
It looks like Red Star Macalline Group Corporation Ltd. pays its CEO less than similar sized companies.
Since the business is growing, many would argue this suggests the pay is modest. While returns over the last few years haven't been top notch, there is nothing to suggest to us that Jianxing Che is overcompensated. It's great to see a company that pays its CEO reasonably, even while growing. It would be an additional positive if insiders are buying shares. Whatever your view on compensation, you might want to check if insiders are buying or selling Red Star Macalline Group shares (free trial).
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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