Is Hi Sun Technology (China) Limited's (HKG:818) CEO Pay Justified?

The CEO of Hi Sun Technology (China) Limited (HKG:818) is Man Kui. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Hi Sun Technology (China)

How Does Man Kui's Compensation Compare With Similar Sized Companies?

According to our data, Hi Sun Technology (China) Limited has a market capitalization of HK$3.5b, and paid its CEO total annual compensation worth HK$8.5m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at HK$2.3m. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. 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, Man Kui is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Hi Sun Technology (China) Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Hi Sun Technology (China) has changed over time.

Is Hi Sun Technology (China) Limited Growing?

Hi Sun Technology (China) Limited 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). In the last year, its revenue is up 51%.

This shows that the company has improved itself over the last few years. Good news for shareholders. 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 Hi Sun Technology (China) Limited Been A Good Investment?

Hi Sun Technology (China) Limited has generated a total shareholder return of 4.1% over three years, so most shareholders wouldn't be too disappointed. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

We examined the amount Hi Sun Technology (China) 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.

Importantly, though, the company has impressed with its earnings per share growth, over three years. We also think investors are doing ok, over the same time period. So, considering the EPS growth we do not wish to criticize the level of CEO compensation, though we'd recommend further research on management. Shareholders may want to check for free if Hi Sun Technology (China) insiders are buying or selling shares.

If you want to buy a stock that is better than Hi Sun Technology (China), this free list of high return, low debt companies is a great place to look.

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.

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