Increases to CEO Compensation Might Be Put On Hold For Now at Adgar Investments and Development Ltd (TLV:ADGR)

Key Insights

• Adgar Investments and Development's Annual General Meeting to take place on 16th of December
• Total pay for CEO Roy Gadish includes ₪1.56m salary
• The overall pay is 117% above the industry average
• Adgar Investments and Development's EPS grew by 45% over the past three years while total shareholder loss over the past three years was 20%

Shareholders of Adgar Investments and Development Ltd (TLV:ADGR) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 16th of December. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for Adgar Investments and Development

How Does Total Compensation For Roy Gadish Compare With Other Companies In The Industry?

At the time of writing, our data shows that Adgar Investments and Development Ltd has a market capitalization of ₪941m, and reported total annual CEO compensation of ₪4.4m for the year to December 2023. That's a notable increase of 8.5% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₪1.6m.

On comparing similar companies from the Israel Real Estate industry with market caps ranging from ₪357m to ₪1.4b, we found that the median CEO total compensation was ₪2.0m. This suggests that Roy Gadish is paid more than the median for the industry. Furthermore, Roy Gadish directly owns ₪13m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	₪1.6m	₪1.5m	35%
Other	₪2.9m	₪2.6m	65%
Total Compensation	₪4.4m	₪4.1m	100%

On an industry level, roughly 54% of total compensation represents salary and 46% is other remuneration. Adgar Investments and Development 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.

Adgar Investments and Development Ltd's Growth

Adgar Investments and Development Ltd's earnings per share (EPS) grew 45% per year over the last three years. Its revenue is up 7.2% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Adgar Investments and Development Ltd Been A Good Investment?

With a three year total loss of 20% for the shareholders, Adgar Investments and Development Ltd would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

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. 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. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 4 warning signs (and 2 which are significant) in Adgar Investments and Development we think you should know about.

Switching gears from Adgar Investments and Development, 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.