Key Insights

• Greenpro Capital to hold its Annual General Meeting on 22nd of November
• CEO CK Lee's total compensation includes salary of US$299.0k
• Total compensation is 59% below industry average
• Greenpro Capital's three-year loss to shareholders was 89% while its EPS grew by 68% over the past three years

Shareholders may be wondering what CEO CK Lee plans to do to improve the less than great performance at Greenpro Capital Corp. (NASDAQ:GRNQ) recently. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 22nd of November. It has been shown that setting appropriate executive remuneration incentivises the management to act in the interests of shareholders. We think CEO compensation looks appropriate given the data we have put together.

How Does Total Compensation For CK Lee Compare With Other Companies In The Industry?

According to our data, Greenpro Capital Corp. has a market capitalization of US$7.0m, and paid its CEO total annual compensation worth US$325k over the year to December 2023. This was the same amount the CEO received in the prior year. In particular, the salary of US$299.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the American Capital Markets industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$786k. In other words, Greenpro Capital pays its CEO lower than the industry median. Moreover, CK Lee also holds US$1.8m worth of Greenpro Capital stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 10% of total compensation out of all the companies we analyzed, while other remuneration made up 90% of the pie. Greenpro Capital pays out 92% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Greenpro Capital Corp.'s Growth

Greenpro Capital Corp.'s earnings per share (EPS) grew 68% per year over the last three years. In the last year, its revenue is down 17%.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. 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 Greenpro Capital Corp. Been A Good Investment?

The return of -89% over three years would not have pleased Greenpro Capital Corp. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The loss to shareholders over the past three years is certainly concerning. The share price trend has diverged with the robust growth in EPS however, suggesting there may be other factors that could be driving the price performance. There needs to be more focus by management and the board to examine why the share price has diverged from fundamentals. In the upcoming AGM, shareholders should take this opportunity to raise these concerns with the board and revisit their investment thesis with regards to the company.

CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 4 warning signs for Greenpro Capital (of which 2 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Important note: Greenpro Capital is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.