Shareholders May Find It Hard To Justify Increasing Payment Financial Technologies Ltd's (TLV:PMNT) CEO Compensation For Now

Key Insights

• Payment Financial Technologies will host its Annual General Meeting on 31st of December
• CEO Yaniv Gilor's total compensation includes salary of ₪1.33m
• Total compensation is similar to the industry average
• Payment Financial Technologies' EPS grew by 46% over the past three years while total shareholder loss over the past three years was 48%

In the past three years, the share price of Payment Financial Technologies Ltd (TLV:PMNT) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 31st of December could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

View our latest analysis for Payment Financial Technologies

How Does Total Compensation For Yaniv Gilor Compare With Other Companies In The Industry?

According to our data, Payment Financial Technologies Ltd has a market capitalization of ₪119m, and paid its CEO total annual compensation worth ₪2.3m over the year to December 2023. That's a notable increase of 41% on last year. We note that the salary of ₪1.33m makes up a sizeable portion of the total compensation received by the CEO.

On comparing similar-sized companies in the Israel Diversified Financial industry with market capitalizations below ₪729m, we found that the median total CEO compensation was ₪2.1m. This suggests that Payment Financial Technologies remunerates its CEO largely in line with the industry average. Moreover, Yaniv Gilor also holds ₪25m worth of Payment Financial Technologies stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	₪1.3m	₪1.3m	57%
Other	₪997k	₪349k	43%
Total Compensation	₪2.3m	₪1.7m	100%

Speaking on an industry level, nearly 43% of total compensation represents salary, while the remainder of 57% is other remuneration. It's interesting to note that Payment Financial Technologies pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Payment Financial Technologies Ltd's Growth

Over the past three years, Payment Financial Technologies Ltd has seen its earnings per share (EPS) grow by 46% per year. It achieved revenue growth of 1.5% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. 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 Payment Financial Technologies Ltd Been A Good Investment?

With a total shareholder return of -48% over three years, Payment Financial Technologies Ltd shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 4 warning signs for Payment Financial Technologies that investors should think about before committing capital to this stock.

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.