Key Insights

• Sunwah Kingsway Capital Holdings' Annual General Meeting to take place on 28th of November
• CEO Michael Choi's total compensation includes salary of HK$2.28m
• The total compensation is similar to the average for the industry
• Sunwah Kingsway Capital Holdings' EPS declined by 47% over the past three years while total shareholder loss over the past three years was 28%

The underwhelming share price performance of Sunwah Kingsway Capital Holdings Limited (HKG:188) in the past three years would have disappointed many shareholders. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. The AGM coming up on 28th of November will be an opportunity for shareholders to have their concerns addressed by the board and for them to exercise their influence on management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders might be hesitant about approving a raise at the moment.

Comparing Sunwah Kingsway Capital Holdings Limited's CEO Compensation With The Industry

Our data indicates that Sunwah Kingsway Capital Holdings Limited has a market capitalization of HK$165m, and total annual CEO compensation was reported as HK$2.4m for the year to June 2024. This was the same as last year. Notably, the salary which is HK$2.28m, represents most of the total compensation being paid.

For comparison, other companies in the Hong Kong Capital Markets industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.1m. So it looks like Sunwah Kingsway Capital Holdings compensates Michael Choi in line with the median for the industry. Furthermore, Michael Choi directly owns HK$16m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 85% of total compensation out of all the companies we analyzed, while other remuneration made up 15% of the pie. Sunwah Kingsway Capital Holdings is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Sunwah Kingsway Capital Holdings Limited's Growth Numbers

Over the last three years, Sunwah Kingsway Capital Holdings Limited has shrunk its earnings per share by 47% per year. Its revenue is up 113% over the last year.

The decrease in EPS could be a concern for some investors. On the other hand, the strong revenue growth suggests the business is growing. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Sunwah Kingsway Capital Holdings Limited Been A Good Investment?

With a three year total loss of 28% for the shareholders, Sunwah Kingsway Capital Holdings Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Michael receives almost all of their compensation through a salary. The company's earnings haven't grown and possibly because of that, the stock has performed poorly, resulting in a loss for the company's shareholders. The upcoming AGM will provide shareholders the opportunity to revisit the company's remuneration policies and evaluate if the board's judgement and decision-making is aligned with that of the company's shareholders.

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 4 warning signs for Sunwah Kingsway Capital Holdings (of which 2 are potentially serious!) 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.