Isaac Angel has been the CEO of Ormat Technologies, Inc. (NYSE:ORA) since 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Isaac Angel's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Ormat Technologies, Inc. has a market cap of US$3.9b, and reported total annual CEO compensation of US$8.0m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$594k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO total compensation was US$5.1m.
It would therefore appear that Ormat Technologies, Inc. pays Isaac Angel more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at Ormat Technologies, below.
Is Ormat Technologies, Inc. Growing?
Earnings per share at Ormat Technologies, Inc. are much the same as they were three years ago, albeit with a positive trend. Its revenue is up 7.0% over last year.
I'd prefer higher revenue growth, but I'm happy with the modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. It could be important to check this free visual depiction of what analysts expect for the future.
Has Ormat Technologies, Inc. Been A Good Investment?
Boasting a total shareholder return of 50% over three years, Ormat Technologies, Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
We compared the total CEO remuneration paid by Ormat Technologies, Inc., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
One might like to have seen stronger growth, but shareholder returns have been pleasing, over the last three years. As a result of the juicy return to investors, the CEO remuneration may well be quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling Ormat Technologies shares (free trial).
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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