We Think Shareholders Are Less Likely To Approve A Pay Rise For Amot Investments Ltd.'s (TLV:AMOT) CEO For Now

Key Insights

• Amot Investments will host its Annual General Meeting on 15th of August
• Total pay for CEO Shimon Abudraham includes ₪1.98m salary
• The total compensation is similar to the average for the industry
• Amot Investments' EPS grew by 5.7% over the past three years while total shareholder loss over the past three years was 6.7%

In the past three years, shareholders of Amot Investments Ltd. (TLV:AMOT) have seen a loss on their investment. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 15th of August. 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.

See our latest analysis for Amot Investments

Comparing Amot Investments Ltd.'s CEO Compensation With The Industry

According to our data, Amot Investments Ltd. has a market capitalization of ₪7.8b, and paid its CEO total annual compensation worth ₪4.3m over the year to December 2023. That's a fairly small increase of 4.2% over the previous year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₪2.0m.

For comparison, other companies in the Israel Real Estate industry with market capitalizations ranging between ₪3.8b and ₪12b had a median total CEO compensation of ₪3.6m. This suggests that Amot Investments remunerates its CEO largely in line with the industry average. Furthermore, Shimon Abudraham directly owns ₪15m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	₪2.0m	₪1.9m	46%
Other	₪2.4m	₪2.3m	54%
Total Compensation	₪4.3m	₪4.2m	100%

Speaking on an industry level, nearly 53% of total compensation represents salary, while the remainder of 47% is other remuneration. It's interesting to note that Amot Investments allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Amot Investments Ltd.'s Growth Numbers

Over the past three years, Amot Investments Ltd. has seen its earnings per share (EPS) grow by 5.7% per year. Its revenue is up 4.4% over the last year.

We're not particularly impressed by the revenue growth, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. 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 Amot Investments Ltd. Been A Good Investment?

With a three year total loss of 6.7% for the shareholders, Amot Investments Ltd. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. 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 compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 4 warning signs for Amot Investments (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Amot Investments, 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.