It Looks Like Sella Capital Real Estate Ltd.'s (TLV:SLARL) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• Sella Capital Real Estate's Annual General Meeting to take place on 27th of November
• CEO Gadi Elikam's total compensation includes salary of ₪2.07m
• The overall pay is comparable to the industry average
• Sella Capital Real Estate's EPS declined by 8.4% over the past three years while total shareholder loss over the past three years was 6.4%

The results at Sella Capital Real Estate Ltd. (TLV:SLARL) have been quite disappointing recently and CEO Gadi Elikam bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 27th of November. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Sella Capital Real Estate

Comparing Sella Capital Real Estate Ltd.'s CEO Compensation With The Industry

According to our data, Sella Capital Real Estate Ltd. has a market capitalization of ₪1.9b, and paid its CEO total annual compensation worth ₪3.3m over the year to December 2023. This means that the compensation hasn't changed much from last year. Notably, the salary which is ₪2.07m, represents most of the total compensation being paid.

On examining similar-sized companies in the Israel REITs industry with market capitalizations between ₪748m and ₪3.0b, we discovered that the median CEO total compensation of that group was ₪3.0m. From this we gather that Gadi Elikam is paid around the median for CEOs in the industry. Furthermore, Gadi Elikam directly owns ₪11m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	₪2.1m	₪1.9m	64%
Other	₪1.2m	₪1.4m	36%
Total Compensation	₪3.3m	₪3.3m	100%

Talking in terms of the industry, salary represented approximately 41% of total compensation out of all the companies we analyzed, while other remuneration made up 59% of the pie. Sella Capital Real Estate is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Sella Capital Real Estate Ltd.'s Growth Numbers

Sella Capital Real Estate Ltd. has reduced its earnings per share by 8.4% a year over the last three years. It achieved revenue growth of 4.6% over the last year.

Few shareholders would be pleased to read that EPS have declined. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in 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 Sella Capital Real Estate Ltd. Been A Good Investment?

Since shareholders would have lost about 6.4% over three years, some Sella Capital Real Estate Ltd. investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

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. We did our research and identified 4 warning signs (and 2 which shouldn't be ignored) in Sella Capital Real Estate we think you should know about.

Important note: Sella Capital Real Estate is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.