The CEO of Asia Financial Holdings Limited (HKG:662) is Bernard Chan. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. 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.
How Does Bernard Chan’s Compensation Compare With Similar Sized Companies?
According to our data, Asia Financial Holdings Limited has a market capitalization of HK$3.8b, and paid its CEO total annual compensation worth HK$8.6m over the year to December 2018. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at HK$5.0m. We examined companies with market caps from HK$1.6b to HK$6.2b, and discovered that the median CEO total compensation of that group was HK$2.6m.
As you can see, Bernard Chan is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Asia Financial Holdings Limited is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Asia Financial Holdings has changed over time.
Is Asia Financial Holdings Limited Growing?
Over the last three years Asia Financial Holdings Limited has grown its earnings per share (EPS) by an average of 8.5% per year (using a line of best fit). Its revenue is up 2.3% over last year.
I’d prefer higher revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Asia Financial Holdings Limited Been A Good Investment?
With a total shareholder return of 7.3% over three years, Asia Financial Holdings Limited has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.
We examined the amount Asia Financial Holdings Limited pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
One might like to have seen stronger growth, and the shareholder returns have failed to inspire, over the last three years. So it’s certainly hard to argue that the CEO is modestly paid, although we don’t see the remuneration as an issue. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Asia Financial Holdings (free visualization of insider trades).
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.
If you spot an error that warrants correction, please contact the editor at email@example.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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