In This Article:
In 2015 Chi Fai Tang was appointed CEO of Union Medical Healthcare Limited (HKG:2138). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. 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 Union Medical Healthcare
How Does Chi Fai Tang's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Union Medical Healthcare Limited has a market cap of HK$5.3b, and reported total annual CEO compensation of HK$1.2m for the year to March 2019. Notably, the salary of HK$1.2m is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations from HK$3.1b to HK$13b, and the median CEO total compensation was HK$3.3m.
A first glance this seems like a real positive for shareholders, since Chi Fai Tang 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 Union Medical Healthcare has changed from year to year.
Is Union Medical Healthcare Limited Growing?
Union Medical Healthcare Limited has increased its earnings per share (EPS) by an average of 26% a year, over the last three years (using a line of best fit). It achieved revenue growth of 32% over the last year.
This demonstrates that the company has been improving recently. A good result. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. You might want to check this free visual report on analyst forecasts for future earnings.
Has Union Medical Healthcare Limited Been A Good Investment?
I think that the total shareholder return of 144%, over three years, would leave most Union Medical Healthcare Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
Union Medical Healthcare Limited is currently paying its CEO below what is normal for companies of its size.
Since the business is growing, many would argue this suggests the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Chi Fai Tang deserves a raise! It is relatively rare to see a modestly paid CEO when performance is so impressive. It would be even more positive if company insiders are buying shares. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Union Medical Healthcare (free visualization of insider trades).