Here's Why Shareholders May Want To Be Cautious With Increasing Enlight Renewable Energy Ltd's (TLV:ENLT) CEO Pay Packet

Key Insights

• Enlight Renewable Energy to hold its Annual General Meeting on 27th of December
• Total pay for CEO Gilad Yavetz includes US$435.0k salary
• The total compensation is 1,687% higher than the average for the industry
• Enlight Renewable Energy's EPS grew by 158% over the past three years while total shareholder return over the past three years was 12%

Under the guidance of CEO Gilad Yavetz, Enlight Renewable Energy Ltd (TLV:ENLT) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 27th of December. However, some shareholders will still be cautious of paying the CEO excessively.

View our latest analysis for Enlight Renewable Energy

Comparing Enlight Renewable Energy Ltd's CEO Compensation With The Industry

According to our data, Enlight Renewable Energy Ltd has a market capitalization of ₪8.5b, and paid its CEO total annual compensation worth US$2.8m over the year to December 2022. Notably, that's an increase of 68% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$435k.

On comparing similar companies from the Israel Renewable Energy industry with market caps ranging from ₪3.6b to ₪12b, we found that the median CEO total compensation was US$155k. Hence, we can conclude that Gilad Yavetz is remunerated higher than the industry median. Moreover, Gilad Yavetz also holds ₪58m worth of Enlight Renewable Energy stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2022	2021	Proportion (2022)
Salary	US$435k	US$436k	16%
Other	US$2.3m	US$1.2m	84%
Total Compensation	US$2.8m	US$1.6m	100%

On an industry level, around 29% of total compensation represents salary and 71% is other remuneration. In Enlight Renewable Energy's case, non-salary compensation represents a greater slice of total remuneration, 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.

Enlight Renewable Energy Ltd's Growth

Over the past three years, Enlight Renewable Energy Ltd has seen its earnings per share (EPS) grow by 158% per year. Its revenue is up 58% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Enlight Renewable Energy Ltd Been A Good Investment?

With a total shareholder return of 12% over three years, Enlight Renewable Energy Ltd shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this 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. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 3 warning signs (and 2 which are significant) in Enlight Renewable Energy we think you should know about.

Switching gears from Enlight Renewable Energy, 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.