Shareholders Will Probably Hold Off On Increasing Unitronics (1989) (R"G) Ltd's (TLV:UNIT) CEO Compensation For The Time Being

Key Insights

• Unitronics (1989) (RG) will host its Annual General Meeting on 19th of June
• CEO Amit Harari's total compensation includes salary of ₪967.0k
• The overall pay is 244% above the industry average
• Unitronics (1989) (RG)'s total shareholder return over the past three years was 124% while its EPS grew by 45% over the past three years

Performance at Unitronics (1989) (R"G) Ltd (TLV:UNIT) has been reasonably good and CEO Amit Harari has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 19th of June. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

Check out our latest analysis for Unitronics (1989) (RG)

How Does Total Compensation For Amit Harari Compare With Other Companies In The Industry?

At the time of writing, our data shows that Unitronics (1989) (R"G) Ltd has a market capitalization of ₪558m, and reported total annual CEO compensation of ₪1.5m for the year to December 2023. We note that's an increase of 20% above last year. Notably, the salary which is ₪967.0k, represents most of the total compensation being paid.

On examining similar-sized companies in the Israel Electronic industry with market capitalizations between ₪370m and ₪1.5b, we discovered that the median CEO total compensation of that group was ₪432k. Accordingly, our analysis reveals that Unitronics (1989) (R"G) Ltd pays Amit Harari north of the industry median.

Component	2023	2022	Proportion (2023)
Salary	₪967k	₪850k	65%
Other	₪517k	₪391k	35%
Total Compensation	₪1.5m	₪1.2m	100%

Talking in terms of the industry, salary represented approximately 68% of total compensation out of all the companies we analyzed, while other remuneration made up 32% of the pie. Although there is a difference in how total compensation is set, Unitronics (1989) (RG) more or less reflects the market in terms of setting the salary. 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.

Unitronics (1989) (R"G) Ltd's Growth

Unitronics (1989) (R"G) Ltd has seen its earnings per share (EPS) increase by 45% a year over the past three years. Its revenue is up 28% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Unitronics (1989) (R"G) Ltd Been A Good Investment?

We think that the total shareholder return of 124%, over three years, would leave most Unitronics (1989) (R"G) Ltd shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Unitronics (1989) (RG) that investors should think about before committing capital to this stock.

Important note: Unitronics (1989) (RG) 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.