Yona Ovadia has been the CEO of Gilat Satellite Networks Ltd. (NASDAQ:GILT) since 2016. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Yona Ovadia’s Compensation Compare With Similar Sized Companies?
Our data indicates that Gilat Satellite Networks Ltd. is worth US$486m, and total annual CEO compensation is US$920k. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$366k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$200m to US$800m. The median total CEO compensation was US$1.8m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you’ll need to understand the business better before you can form an opinion.
The graphic below shows how CEO compensation at Gilat Satellite Networks has changed from year to year.
Is Gilat Satellite Networks Ltd. Growing?
On average over the last three years, Gilat Satellite Networks Ltd. has grown earnings per share (EPS) by 118% each year (using a line of best fit). Its revenue is down -11% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn’t ideal, but it is the bottom line that counts most in business.
Has Gilat Satellite Networks Ltd. Been A Good Investment?
I think that the total shareholder return of 101%, over three years, would leave most Gilat Satellite Networks Ltd. shareholders smiling. 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.
It appears that Gilat Satellite Networks Ltd. remunerates its CEO below most similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. The pleasing shareholder returns are the cherry on top; you might even consider that Yona Ovadia deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. But it is even better if company insiders are also buying shares with their own money. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Gilat Satellite Networks.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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