Key Insights

• Wong's International Holdings to hold its Annual General Meeting on 5th of June
• Total pay for CEO Ben Wong includes HK$4.59m salary
• Total compensation is 215% above industry average
• Wong's International Holdings' EPS grew by 113% over the past three years while total shareholder loss over the past three years was 37%

The underwhelming share price performance of Wong's International Holdings Limited (HKG:99) in the past three years would have disappointed many shareholders. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 5th of June could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

How Does Total Compensation For Ben Wong Compare With Other Companies In The Industry?

According to our data, Wong's International Holdings Limited has a market capitalization of HK$665m, and paid its CEO total annual compensation worth HK$7.5m over the year to December 2023. Notably, that's an increase of 30% over the year before. In particular, the salary of HK$4.59m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the Hong Kong Electronic industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$2.4m. Hence, we can conclude that Ben Wong is remunerated higher than the industry median. What's more, Ben Wong holds HK$243m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, roughly 79% of total compensation represents salary and 21% is other remuneration. It's interesting to note that Wong's International Holdings allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Wong's International Holdings Limited's Growth

Wong's International Holdings Limited's earnings per share (EPS) grew 113% per year over the last three years. It saw its revenue drop 8.1% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Wong's International Holdings Limited Been A Good Investment?

The return of -37% over three years would not have pleased Wong's International Holdings Limited shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 3 warning signs for Wong's International Holdings (of which 1 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.