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Dongfeng Wang has been the CEO of Forgame Holdings Limited (HKG:484) since 2011. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. 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.
Check out our latest analysis for Forgame Holdings
How Does Dongfeng Wang’s Compensation Compare With Similar Sized Companies?
Our data indicates that Forgame Holdings Limited is worth HK$541m, and total annual CEO compensation is CN¥2.6m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at CN¥468k. We examined a group of similar sized companies, with market capitalizations of below CN¥1.3b. The median CEO compensation in that group is CN¥1.4m.
It would therefore appear that Forgame Holdings Limited pays Dongfeng Wang 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. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Forgame Holdings has changed from year to year.
Is Forgame Holdings Limited Growing?
On average over the last three years, Forgame Holdings Limited has grown earnings per share (EPS) by 4.8% each year (using a line of best fit). It achieved revenue growth of 49% over the last year.
I like the look of the strong year-on-year improvement in revenue. And in that context, the modest EPS improvement certainly isn’t shabby. I wouldn’t say this is necessarily top notch growth, but it is certainly promising. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Forgame Holdings Limited Been A Good Investment?
With a three year total loss of 66%, Forgame Holdings Limited would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary…
We compared total CEO remuneration at Forgame Holdings Limited with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.