Why We Think The CEO Of Ratio Energies - Limited Partnership (TLV:RATI) May Soon See A Pay Rise

Key Insights

• Ratio Energies - Limited Partnership will host its Annual General Meeting on 19th of August
• CEO Yigal Landau's total compensation includes salary of US$189.0k
• The total compensation is 79% less than the average for the industry
• Over the past three years, Ratio Energies - Limited Partnership's EPS grew by 50% and over the past three years, the total shareholder return was 146%

The solid performance at Ratio Energies - Limited Partnership (TLV:RATI) has been impressive and shareholders will probably be pleased to know that CEO Yigal Landau has delivered. At the upcoming AGM on 19th of August, they would be interested to hear about the company strategy going forward and get a chance to cast their votes on resolutions such as executive remuneration and other company matters. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

View our latest analysis for Ratio Energies - Limited Partnership

Comparing Ratio Energies - Limited Partnership's CEO Compensation With The Industry

According to our data, Ratio Energies - Limited Partnership has a market capitalization of ₪3.1b, and paid its CEO total annual compensation worth US$189k over the year to December 2023. That is, the compensation was roughly the same as last year. Notably, the salary of US$189k is the entirety of the CEO compensation.

On examining similar-sized companies in the Israel Oil and Gas industry with market capitalizations between ₪1.5b and ₪6.1b, we discovered that the median CEO total compensation of that group was US$887k. Accordingly, Ratio Energies - Limited Partnership pays its CEO under the industry median. Furthermore, Yigal Landau directly owns ₪27m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2021	Proportion (2023)
Salary	US$189k	US$190k	100%
Other	-	-	-
Total Compensation	US$189k	US$190k	100%

Speaking on an industry level, nearly 46% of total compensation represents salary, while the remainder of 54% is other remuneration. On a company level, Ratio Energies - Limited Partnership prefers to reward its CEO through a salary, opting not to pay Yigal Landau through non-salary benefits. 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 Ratio Energies - Limited Partnership's Growth Numbers

Over the past three years, Ratio Energies - Limited Partnership has seen its earnings per share (EPS) grow by 50% per year. It saw its revenue drop 9.7% over the last year.

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. 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 Ratio Energies - Limited Partnership Been A Good Investment?

Boasting a total shareholder return of 146% over three years, Ratio Energies - Limited Partnership has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Ratio Energies - Limited Partnership pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

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 2 warning signs for Ratio Energies - Limited Partnership that you should be aware of before investing.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.