Increases to OPC Energy Ltd.'s (TLV:OPCE) CEO Compensation Might Cool off for now

Key Insights

• OPC Energy to hold its Annual General Meeting on 11th of December
• Salary of ₪3.28m is part of CEO Giora Almogi's total remuneration
• The total compensation is 1,879% higher than the average for the industry
• OPC Energy's three-year loss to shareholders was 27% while its EPS grew by 45% over the past three years

Shareholders of OPC Energy Ltd. (TLV:OPCE) will have been dismayed by the negative share price return over the last three years. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 11th of December. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

View our latest analysis for OPC Energy

How Does Total Compensation For Giora Almogi Compare With Other Companies In The Industry?

According to our data, OPC Energy Ltd. has a market capitalization of ₪4.8b, and paid its CEO total annual compensation worth ₪11m over the year to December 2022. Notably, that's an increase of 26% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at ₪3.3m.

On comparing similar companies from the Israel Renewable Energy industry with market caps ranging from ₪3.7b to ₪12b, we found that the median CEO total compensation was ₪578k. This suggests that Giora Almogi is paid more than the median for the industry.

Component	2022	2021	Proportion (2022)
Salary	₪3.3m	₪3.1m	29%
Other	₪8.2m	₪5.9m	71%
Total Compensation	₪11m	₪9.1m	100%

Talking in terms of the industry, salary represented approximately 29% of total compensation out of all the companies we analyzed, while other remuneration made up 71% of the pie. OPC Energy is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at OPC Energy Ltd.'s Growth Numbers

Over the past three years, OPC Energy Ltd. has seen its earnings per share (EPS) grow by 45% per year. It achieved revenue growth of 34% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 OPC Energy Ltd. Been A Good Investment?

Given the total shareholder loss of 27% over three years, many shareholders in OPC Energy Ltd. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 2 warning signs for OPC Energy that investors should look into moving forward.

Switching gears from OPC 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.