What Can We Conclude About Nissan Medical Industries' (TLV:NISA) CEO Pay?

Hezi Nissan became the CEO of Nissan Medical Industries Ltd. (TLV:NISA) in 1984, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Nissan Medical Industries

How Does Total Compensation For Hezi Nissan Compare With Other Companies In The Industry?

According to our data, Nissan Medical Industries Ltd. has a market capitalization of ₪266m, and paid its CEO total annual compensation worth ₪2.2m over the year to December 2019. That's a notable decrease of 24% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₪593k.

For comparison, other companies in the industry with market capitalizations below ₪650m, reported a median total CEO compensation of ₪663k. This suggests that Hezi Nissan is paid more than the median for the industry. Furthermore, Hezi Nissan directly owns ₪141m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the broader industry, salary and other compensation roughly make up 50% each, of the total compensation. Nissan Medical Industries sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Nissan Medical Industries Ltd.'s Growth

Nissan Medical Industries Ltd.'s earnings per share (EPS) grew 103% per year over the last three years. In the last year, its revenue is up 9.5%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Nissan Medical Industries Ltd. Been A Good Investment?

Nissan Medical Industries Ltd. has served shareholders reasonably well, with a total return of 11% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

As we touched on above, Nissan Medical Industries Ltd. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, the EPS growth over three years is certainly impressive. We also think investor returns are steady over the same time period. So, considering the EPS growth we do not wish to criticize CEO compensation, though we'd recommend further research on management.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 2 warning signs for Nissan Medical Industries that investors should look into moving forward.

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. 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.
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