Mark Costa became the CEO of Eastman Chemical Company (NYSE:EMN) in 2014. First, this article will compare CEO compensation with compensation at other large companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Eastman Chemical

At the time of writing, our data says that Eastman Chemical Company has a market cap of US$10b, and reported total annual CEO compensation of US$16m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$1.2m. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. When we examined a group of companies with market caps over US$8.0b, we found that their median CEO total compensation was US$11m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.

Thus we can conclude that Mark Costa receives more in total compensation than the median of a group of large companies in the same market as Eastman Chemical Company. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Eastman Chemical has changed over time.

NYSE:EMN CEO Compensation, January 8th 2020

Over the last three years Eastman Chemical Company has grown its earnings per share (EPS) by an average of 5.6% per year (using a line of best fit). Its revenue is down 6.8% over last year.

I generally like to see a little revenue growth, but it is good to see EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. It could be important to check this free visual depiction of what analysts expect for the future.

With a total shareholder return of 5.3% over three years, Eastman Chemical Company has done okay by shareholders. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

We examined the amount Eastman Chemical Company pays its CEO, and compared it to the amount paid by other large companies. As discussed above, we discovered that the company pays more than the median of that group.

We generally prefer to see stronger EPS growth, and we're not particularly impressed with the total shareholder return, over the last three years. So it's certainly hard to argue that the CEO is modestly paid, although we don't see the remuneration as an issue. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Eastman Chemical (free visualization of insider trades).

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

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.

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. Thank you for reading.

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Should You Be Pleased About The CEO Pay At Eastman Chemical Company's (NYSE:EMN) - Yahoo Finance