The CEO of PuraPharm Corporation Limited (HKG:1498) is Abraham Chan. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

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Check out our latest analysis for PuraPharm

How Does Abraham Chan's Compensation Compare With Similar Sized Companies?

According to our data, PuraPharm Corporation Limited has a market capitalization of HK$493m, and pays its CEO total annual compensation worth HK$4.0m. (This number is for the twelve months until December 2017). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at HK$3.6m. We examined a group of similar sized companies, with market capitalizations of below HK$1.6b. The median CEO total compensation in that group is HK$1.5m.

As you can see, Abraham 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 PuraPharm Corporation 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.

The graphic below shows how CEO compensation at PuraPharm has changed from year to year.

Is PuraPharm Corporation Limited Growing?

PuraPharm Corporation Limited has reduced its earnings per share by an average of 51% a year, over the last three years (measured with a line of best fit). Its revenue is up 26% over last year.

The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. You might want to check this free visual report on analyst forecasts for future earnings.

Has PuraPharm Corporation Limited Been A Good Investment?

Given the total loss of 40% over three years, many shareholders in PuraPharm Corporation Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

We compared the total CEO remuneration paid by PuraPharm Corporation Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. Shareholders may want to check for free if PuraPharm insiders are buying or selling shares.

If you want to buy a stock that is better than PuraPharm, this free list of high return, low debt companies is a great place to look.

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.