A Look At Albaad Massuot Yitzhak's (TLV:ALBA) CEO Remuneration

Dan Mesika has been the CEO of Albaad Massuot Yitzhak Ltd (TLV:ALBA) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Albaad Massuot Yitzhak pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Albaad Massuot Yitzhak

Comparing Albaad Massuot Yitzhak Ltd's CEO Compensation With the industry

At the time of writing, our data shows that Albaad Massuot Yitzhak Ltd has a market capitalization of ₪706m, and reported total annual CEO compensation of ₪1.6m for the year to December 2019. That's a notable decrease of 13% on last year. Notably, the salary of ₪1.6m is the entirety of the CEO compensation.

For comparison, other companies in the same industry with market capitalizations ranging between ₪334m and ₪1.3b had a median total CEO compensation of ₪1.7m. This suggests that Albaad Massuot Yitzhak remunerates its CEO largely in line with the industry average.

Talking in terms of the industry, salary represented approximately 71% of total compensation out of all the companies we analyzed, while other remuneration made up 29% of the pie. On a company level, Albaad Massuot Yitzhak prefers to reward its CEO through a salary, opting not to pay Dan Mesika through non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Albaad Massuot Yitzhak Ltd's Growth

Albaad Massuot Yitzhak Ltd has reduced its earnings per share by 106% a year over the last three years. Its revenue is up 12% over the last year.

Overall this is not a very positive result for shareholders. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for us to put aside my concerns around EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Albaad Massuot Yitzhak Ltd Been A Good Investment?

Most shareholders would probably be pleased with Albaad Massuot Yitzhak Ltd for providing a total return of 43% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Albaad Massuot Yitzhak rewards its CEO solely through a salary, ignoring non-salary benefits completely. As we touched on above, Albaad Massuot Yitzhak Ltd is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Some investors may take issue with this, especially considering shrinking EPS for the past three years. On the other hand, shareholder returns are showing positive trends over the same time frame. We wouldn't say CEO compensation is too high, but shareholders might think performance needs to be improved before paying any more.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for Albaad Massuot Yitzhak (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

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. 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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