Teddy Gottwald became the CEO of NewMarket Corporation (NYSE:NEU) in 2004. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Teddy Gottwald's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that NewMarket Corporation has a market cap of US$5.0b, and reported total annual CEO compensation of US$2.1m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$1.1m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$4.0b to US$12b. The median total CEO compensation was US$6.5m.
A first glance this seems like a real positive for shareholders, since Teddy Gottwald is paid less than the average total compensation paid by similar sized companies. Though positive, it's important we delve into the performance of the actual business.
You can see a visual representation of the CEO compensation at NewMarket, below.
Is NewMarket Corporation Growing?
Over the last three years NewMarket Corporation has grown its earnings per share (EPS) by an average of 1.9% per year (using a line of best fit). Its revenue is down 5.1% over last year.
I generally like to see a little revenue growth, but I'm happy with the EPS growth. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 NewMarket Corporation Been A Good Investment?
NewMarket Corporation has generated a total shareholder return of 9.7% over three years, so most shareholders wouldn't be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.
NewMarket Corporation is currently paying its CEO below what is normal for companies of its size.
Teddy Gottwald receives relatively low remuneration compared to similar sized companies. But the company isn't exactly firing on all cylinders, from my perspective. So shareholders may not be elated, but they shouldn't be worried about the CEO compensation, either. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling NewMarket (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.
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