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John Fischer has been the CEO of Olin Corporation (NYSE:OLN) since 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. 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.
How Does John Fischer's Compensation Compare With Similar Sized Companies?
According to our data, Olin Corporation has a market capitalization of US$3.4b, and pays its CEO total annual compensation worth US$6.3m. (This figure is for the year to December 2018). That's below the compensation, last year. We think total compensation is more important but we note that the CEO salary is lower, at US$1.1m. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$5.3m.
So John Fischer receives a similar amount to the median CEO pay, amongst the companies we looked at. 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.
The graphic below shows how CEO compensation at Olin has changed from year to year.
Is Olin Corporation Growing?
Olin Corporation has increased its earnings per share (EPS) by an average of 91% a year, over the last three years (using a line of best fit). Its revenue is up 5.9% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. Shareholders might be interested in this free visualization of analyst forecasts.
Has Olin Corporation Been A Good Investment?
With a three year total loss of 0.8%, Olin Corporation would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
John Fischer is paid around the same as most CEOs of similar size companies.
We like that the company is growing EPS, but we find the returns over the last three years to be lacking. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. Whatever your view on compensation, you might want to check if insiders are buying or selling Olin shares (free trial).
Important note: Olin may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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 email@example.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.