George Hongchoy has been the CEO of Link Real Estate Investment Trust (HKG:823) since 2010. This analysis aims first to contrast CEO compensation with other large companies. Next, we’ll consider growth that the business demonstrates. 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.
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How Does George Hongchoy’s Compensation Compare With Similar Sized Companies?
According to our data, Link Real Estate Investment Trust has a market capitalization of HK$204b, and pays its CEO total annual compensation worth HK$66m. (This figure is for the year to March 2018). We think total compensation is more important but we note that the CEO salary is lower, at HK$9.2m. We looked at a group of companies with market capitalizations over HK$63b and the median CEO total compensation was HK$3.3m. There aren’t very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
Thus we can conclude that George Hongchoy receives more in total compensation than the median of a group of large companies in the same market as Link Real Estate Investment Trust. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Link Real Estate Investment Trust has changed over time.
Is Link Real Estate Investment Trust Growing?
Link Real Estate Investment Trust has increased its earnings per share (EPS) by an average of 46% a year, over the last three years (using a line of best fit). Its revenue is up 4.3% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has Link Real Estate Investment Trust Been A Good Investment?
Most shareholders would probably be pleased with Link Real Estate Investment Trust for providing a total return of 130% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
We compared total CEO remuneration at Link Real Estate Investment Trust with the amount paid at other large companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. On top of that, in the same period, returns to shareholders have been great. As a result of this good performance, the CEO remuneration may well be quite reasonable. So you may want to check if insiders are buying Link Real Estate Investment Trust shares with their own money (free access).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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 email@example.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.
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