It's Unlikely That Can-Fite BioPharma Ltd.'s (TLV:CANF) CEO Will See A Huge Pay Rise This Year

Key Insights

• Can-Fite BioPharma's Annual General Meeting to take place on 26th of June
• CEO Motti Farbstein's total compensation includes salary of US$310.0k
• The overall pay is 38% above the industry average
• Can-Fite BioPharma's EPS grew by 50% over the past three years while total shareholder loss over the past three years was 85%

Shareholders of Can-Fite BioPharma Ltd. (TLV:CANF) will have been dismayed by the negative share price return over the last three years. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 26th of June. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

View our latest analysis for Can-Fite BioPharma

How Does Total Compensation For Motti Farbstein Compare With Other Companies In The Industry?

Our data indicates that Can-Fite BioPharma Ltd. has a market capitalization of ₪60m, and total annual CEO compensation was reported as US$467k for the year to December 2023. That is, the compensation was roughly the same as last year. In particular, the salary of US$310.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Israel Biotechs industry with market capitalizations under ₪745m, the reported median total CEO compensation was US$339k. This suggests that Motti Farbstein is paid more than the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	US$310k	US$298k	66%
Other	US$157k	US$173k	34%
Total Compensation	US$467k	US$471k	100%

Talking in terms of the industry, salary represented approximately 74% of total compensation out of all the companies we analyzed, while other remuneration made up 26% of the pie. It's interesting to note that Can-Fite BioPharma allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Can-Fite BioPharma Ltd.'s Growth Numbers

Over the past three years, Can-Fite BioPharma Ltd. has seen its earnings per share (EPS) grow by 50% per year. In the last year, its revenue is down 8.3%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Can-Fite BioPharma Ltd. Been A Good Investment?

The return of -85% over three years would not have pleased Can-Fite BioPharma Ltd. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 7 warning signs for Can-Fite BioPharma (of which 4 are a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Can-Fite BioPharma, 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com