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Is Ituran Location and Control Ltd. (NASDAQ:ITRN) Excessively Paying Its CEO?

Simply Wall St

In 2003 Nir Sheratzky was appointed CEO of Ituran Location and Control Ltd. (NASDAQ:ITRN). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

View our latest analysis for Ituran Location and Control

How Does Nir Sheratzky's Compensation Compare With Similar Sized Companies?

According to our data, Ituran Location and Control Ltd. has a market capitalization of US$597m, and pays its CEO total annual compensation worth US$1.5m. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$577k. 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.

That means Nir Sheratzky receives fairly typical remuneration for the CEO of a company that size. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Ituran Location and Control has changed over time.

NasdaqGS:ITRN CEO Compensation, September 16th 2019

Is Ituran Location and Control Ltd. Growing?

Over the last three years Ituran Location and Control Ltd. has grown its earnings per share (EPS) by an average of 24% per year (using a line of best fit). In the last year, its revenue is up 15%.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. It could be important to check this free visual depiction of what analysts expect for the future.

Has Ituran Location and Control Ltd. Been A Good Investment?

Ituran Location and Control Ltd. has served shareholders reasonably well, with a total return of 24% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Nir Sheratzky is paid around what is normal the leaders of comparable size companies.

We would wish for better returns (whether dividends or capital gains) but we do admire the solid EPS growth on show here. So upon reflection one could argue that the CEO pay is quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling Ituran Location and Control shares (free trial).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.