Is Sun Hing Vision Group Holdings Limited (HKG:125) Excessively Paying Its CEO?

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Otis Ku is the CEO of Sun Hing Vision Group Holdings Limited (HKG:125). 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Sun Hing Vision Group Holdings

How Does Otis Ku's Compensation Compare With Similar Sized Companies?

Our data indicates that Sun Hing Vision Group Holdings Limited is worth HK$499m, and total annual CEO compensation was reported as HK$1.0m for the year to March 2019. We think total compensation is more important but we note that the CEO salary is lower, at HK$208k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. 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.

Most shareholders would consider it a positive that Otis Ku takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.

You can see a visual representation of the CEO compensation at Sun Hing Vision Group Holdings, below.

SEHK:125 CEO Compensation, February 18th 2020
SEHK:125 CEO Compensation, February 18th 2020

Is Sun Hing Vision Group Holdings Limited Growing?

Over the last three years Sun Hing Vision Group Holdings Limited has shrunk its earnings per share by an average of 12% per year (measured with a line of best fit). It saw its revenue drop 6.3% over the last year.

Unfortunately, earnings per share have trended lower over the last three years. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Sun Hing Vision Group Holdings Limited Been A Good Investment?

With a three year total loss of 19%, Sun Hing Vision Group Holdings Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

It looks like Sun Hing Vision Group Holdings Limited pays its CEO less than similar sized companies.

Shareholders should note that compensation for Otis Ku is under the median of a group of similar sized companies. But then, EPS growth is lacking and so are the returns to shareholders. We would not call the pay too generous, but nor would we claim the CEO is underpaid, given lacklustre business performance. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Sun Hing Vision Group Holdings (free visualization of insider trades).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

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. Thank you for reading.

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