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David Ho has been the CEO of Hong Kong Ferry (Holdings) Company Limited (HKG:50) since 1996. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Hong Kong Ferry (Holdings)

How Does David Ho's Compensation Compare With Similar Sized Companies?

Our data indicates that Hong Kong Ferry (Holdings) Company Limited is worth HK$3.0b, and total annual CEO compensation is HK$3.7m. (This number is for the twelve months until December 2018). Notably, the salary of HK$3.7m is the vast majority of the CEO compensation. 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$2.2m.

Thus we can conclude that David Ho receives more in total compensation than the median of a group of companies in the same market, and of similar size to Hong Kong Ferry (Holdings) Company Limited. However, this doesn't necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

The graphic below shows how CEO compensation at Hong Kong Ferry (Holdings) has changed from year to year.

Is Hong Kong Ferry (Holdings) Company Limited Growing?

Over the last three years Hong Kong Ferry (Holdings) Company Limited has grown its earnings per share (EPS) by an average of 29% per year (using a line of best fit). In the last year, its revenue is up 143%.

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. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Hong Kong Ferry (Holdings) Company Limited Been A Good Investment?

Hong Kong Ferry (Holdings) Company Limited has served shareholders reasonably well, with a total return of 11% over three years. 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 Hong Kong Ferry (Holdings) Company Limited pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

However, the earnings per share growth over three years is certainly impressive. We also note that, over the same time frame, shareholder returns haven't been bad. While it may be worth researching further, we don't see a problem with the CEO pay, given the good EPS growth. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Hong Kong Ferry (Holdings).

Important note: Hong Kong Ferry (Holdings) may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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.

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. Thank you for reading.