Here's Why We Think Altshuler Shaham Finance Ltd's (TLV:ALTF) CEO Compensation Looks Fair for the time being

Key Insights

• Altshuler Shaham Finance's Annual General Meeting to take place on 25th of September
• Total pay for CEO Yair Levinstein includes ₪1.94m salary
• The total compensation is similar to the average for the industry
• Altshuler Shaham Finance's total shareholder return over the past three years was 24% while its EPS was down 24% over the past three years

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Despite Altshuler Shaham Finance Ltd's (TLV:ALTF) share price growing positively in the past few years, the per-share earnings growth has not grown to investors' expectations, suggesting that there could be other factors at play driving the share price. Some of these issues will occupy shareholders' minds as the AGM rolls around on 25th of September. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

View our latest analysis for Altshuler Shaham Finance

Comparing Altshuler Shaham Finance Ltd's CEO Compensation With The Industry

At the time of writing, our data shows that Altshuler Shaham Finance Ltd has a market capitalization of ₪1.6b, and reported total annual CEO compensation of ₪1.9m for the year to December 2024. This means that the compensation hasn't changed much from last year. Notably, the salary of ₪1.9m is the entirety of the CEO compensation.

In comparison with other companies in the Israel Capital Markets industry with market capitalizations ranging from ₪668m to ₪2.7b, the reported median CEO total compensation was ₪2.5m. From this we gather that Yair Levinstein is paid around the median for CEOs in the industry. Moreover, Yair Levinstein also holds ₪236m worth of Altshuler Shaham Finance stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 81% of total compensation represents salary, while the remainder of 19% is other remuneration. At the company level, Altshuler Shaham Finance pays Yair Levinstein solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Altshuler Shaham Finance Ltd's Growth Numbers

Over the last three years, Altshuler Shaham Finance Ltd has shrunk its earnings per share by 24% per year. Its revenue is down 1.6% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Altshuler Shaham Finance Ltd Been A Good Investment?

With a total shareholder return of 24% over three years, Altshuler Shaham Finance Ltd shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

Altshuler Shaham Finance rewards its CEO solely through a salary, ignoring non-salary benefits completely. Shareholder returns, while positive, should be looked at along with earnings, which have not grown at all recently. This makes us think the share price momentum may slow in the future. 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.

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 3 warning signs for Altshuler Shaham Finance (of which 1 is potentially serious!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Altshuler Shaham Finance, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.