Our View On Enlight Renewable Energy's (TLV:ENLT) CEO Pay

The CEO of Enlight Renewable Energy Ltd (TLV:ENLT) is Gilad Yavetz, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Enlight Renewable Energy.

Check out 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 ₪5.2b, and paid its CEO total annual compensation worth ₪5.8m over the year to December 2019. That's a notable increase of 76% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at ₪1.2m.

For comparison, other companies in the same industry with market capitalizations ranging between ₪3.3b and ₪10b had a median total CEO compensation of ₪349k. Hence, we can conclude that Gilad Yavetz is remunerated higher than the industry median. Moreover, Gilad Yavetz also holds ₪51m 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.

On an industry level, roughly 81% of total compensation represents salary and 19% 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. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Enlight Renewable Energy Ltd's Growth Numbers

Enlight Renewable Energy Ltd has reduced its earnings per share by 60% a year over the last three years. In the last year, its revenue is up 72%.

The decrease in EPS could be a concern for some investors. But on the other hand, revenue growth is strong, suggesting a brighter future. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Enlight Renewable Energy Ltd Been A Good Investment?

Boasting a total shareholder return of 273% over three years, Enlight Renewable Energy Ltd has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

As we noted earlier, Enlight Renewable Energy pays its CEO higher than the norm for similar-sized companies belonging to the same industry. But shareholder returns and revenue growth have been very healthy as we saw before. Importantly though, EPS has not been growing over the same stretch. All things considered, although EPS growth would've been nice, the positive investor returns and revenue growth lead us to believe Gilad is appropriately paid.

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 4 warning signs (and 3 which are significant) in Enlight Renewable Energy we think you should know about.

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. 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.
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