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This article will reflect on the compensation paid to Igal Zamir who has served as CEO of TAT Technologies Ltd. (NASDAQ:TATT) since 2016. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for TAT Technologies.
How Does Total Compensation For Igal Zamir Compare With Other Companies In The Industry?
At the time of writing, our data shows that TAT Technologies Ltd. has a market capitalization of US$35m, and reported total annual CEO compensation of US$499k for the year to December 2019. That's just a smallish increase of 7.8% on last year. In particular, the salary of US$321.0k, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$429k. This suggests that TAT Technologies remunerates its CEO largely in line with the industry average.
Talking in terms of the industry, salary represented approximately 18% of total compensation out of all the companies we analyzed, while other remuneration made up 82% of the pie. It's interesting to note that TAT Technologies pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
TAT Technologies Ltd.'s Growth
TAT Technologies Ltd. has reduced its earnings per share by 65% a year over the last three years. Its revenue is up 4.1% over the last year.
Overall this is not a very positive result for shareholders. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 TAT Technologies Ltd. Been A Good Investment?
With a three year total loss of 63% for the shareholders, TAT Technologies Ltd. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.
As previously discussed, Igal is compensated close to the median for companies of its size, and which belong to the same industry. In the meantime, the company has reported declining EPS growth and shareholder returns over the last three years. It's tough to call out the compensation as inappropriate, but shareholders might not favor a raise before company performance improves.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 2 warning signs for TAT Technologies (1 doesn't sit too well with us!) that you should be aware of before investing here.
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.
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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