Here's Why Shareholders Will Not Be Complaining About Ravad Ltd's (TLV:RAVD) CEO Pay Packet

Key Insights

• Ravad's Annual General Meeting to take place on 5th of December
• Total pay for CEO Eyal Bigun includes ₪1.06m salary
• The overall pay is comparable to the industry average
• Ravad's total shareholder return over the past three years was 34% while its EPS grew by 14% over the past three years

The performance at Ravad Ltd (TLV:RAVD) has been quite strong recently and CEO Eyal Bigun has played a role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 5th of December. The focus will probably be on the future company strategy as shareholders cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

View our latest analysis for Ravad

How Does Total Compensation For Eyal Bigun Compare With Other Companies In The Industry?

At the time of writing, our data shows that Ravad Ltd has a market capitalization of ₪222m, and reported total annual CEO compensation of ₪1.9m for the year to December 2023. Notably, that's an increase of 17% over the year before. Notably, the salary which is ₪1.06m, represents a considerable chunk of the total compensation being paid.

In comparison with other companies in the Israel Real Estate industry with market capitalizations under ₪731m, the reported median total CEO compensation was ₪1.9m. So it looks like Ravad compensates Eyal Bigun in line with the median for the industry. Furthermore, Eyal Bigun directly owns ₪662k worth of shares in the company.

Component	2023	2022	Proportion (2023)
Salary	₪1.1m	₪1.0m	56%
Other	₪843k	₪612k	44%
Total Compensation	₪1.9m	₪1.6m	100%

On an industry level, around 54% of total compensation represents salary and 46% is other remuneration. Our data reveals that Ravad allocates salary more or less in line with the wider market. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Ravad Ltd's Growth Numbers

Ravad Ltd's earnings per share (EPS) grew 14% per year over the last three years. Its revenue is down 12% over the previous year.

Shareholders would be glad to know that the company has improved itself over the last few years. While it would be good to see revenue growth, profits matter more in the end. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Ravad Ltd Been A Good Investment?

We think that the total shareholder return of 34%, over three years, would leave most Ravad Ltd shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 5 warning signs for Ravad (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.

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. 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.