Key Insights

• China Properties Investment Holdings' Annual General Meeting to take place on 16th of October
• Salary of HK$1.66m is part of CEO Wei Han's total remuneration
• Total compensation is 47% above industry average
• China Properties Investment Holdings' three-year loss to shareholders was 81% while its EPS grew by 26% over the past three years

In the past three years, the share price of China Properties Investment Holdings Limited (HKG:736) has struggled to grow and now shareholders are sitting on a loss. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 16th of October. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

View our latest analysis for China Properties Investment Holdings

Comparing China Properties Investment Holdings Limited's CEO Compensation With The Industry

According to our data, China Properties Investment Holdings Limited has a market capitalization of HK$33m, and paid its CEO total annual compensation worth HK$1.8m over the year to March 2023. Notably, that's a decrease of 26% over the year before. We note that the salary portion, which stands at HK$1.66m constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Hong Kong Consumer Finance industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.2m. Accordingly, our analysis reveals that China Properties Investment Holdings Limited pays Wei Han north of the industry median.

On an industry level, around 78% of total compensation represents salary and 22% is other remuneration. China Properties Investment Holdings is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at China Properties Investment Holdings Limited's Growth Numbers

China Properties Investment Holdings Limited has seen its earnings per share (EPS) increase by 26% a year over the past three years. It saw its revenue drop 83% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has China Properties Investment Holdings Limited Been A Good Investment?

With a total shareholder return of -81% over three years, China Properties Investment Holdings Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. 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 probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 3 warning signs for China Properties Investment Holdings that investors should be aware of in a dynamic business environment.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.