Yahoo Finance Does Melco International Development Limited’s (HKG:200) CEO Salary Reflect Performance?
In 2006 Lawrence Ho was appointed CEO of Melco International Development Limited (HKG:200). 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 process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Melco International Development
How Does Lawrence Ho’s Compensation Compare With Similar Sized Companies?
Our data indicates that Melco International Development Limited is worth HK$21.9b, and total annual CEO compensation is HK$200m. We note that’s an increase of 91% above last year. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of HK$15.6b to HK$50.1b. The median total CEO compensation was HK$4m.
It would therefore appear that Melco International Development Limited pays Lawrence Ho more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Melco International Development has changed from year to year.
Is Melco International Development Limited Growing?
Over the last three years Melco International Development Limited has shrunk its earnings per share by an average of 24% per year. It achieved revenue growth of 6.3% over the last year.
Unfortunately, earnings per share have trended lower over the last three years. The fairly low revenue growth fails to impress given that the earnings per share is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.
It could be important to check this free visual depiction of what analysts expect for the future.
Has Melco International Development Limited Been A Good Investment?
Melco International Development Limited has served shareholders reasonably well, with a total return of 14% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary…
We examined the amount Melco International Development Limited pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.
And shareholder returns are decent but not great. We also note that the CEO compensation is well up on last year. So you may want to delve deeper, because we don’t think the CEO pay is too low. Shareholders may want to check for free if Melco International Development Limited insiders are buying or selling shares.
Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
