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It's Unlikely That The TJX Companies, Inc.'s (NYSE:TJX) CEO Will See A Huge Pay Rise This Year

Key Insights

  • TJX Companies to hold its Annual General Meeting on 4th of June

  • CEO Ernie Herrman's total compensation includes salary of US$1.73m

  • Total compensation is 62% above industry average

  • TJX Companies' total shareholder return over the past three years was 58% while its EPS grew by 48% over the past three years

Under the guidance of CEO Ernie Herrman, The TJX Companies, Inc. (NYSE:TJX) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 4th of June. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for TJX Companies

How Does Total Compensation For Ernie Herrman Compare With Other Companies In The Industry?

At the time of writing, our data shows that The TJX Companies, Inc. has a market capitalization of US$116b, and reported total annual CEO compensation of US$22m for the year to February 2024. We note that's an increase of 8.3% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.7m.

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In comparison with other companies in the American Specialty Retail industry with market capitalizations over US$8.0b, the reported median total CEO compensation was US$14m. This suggests that Ernie Herrman is paid more than the median for the industry. Moreover, Ernie Herrman also holds US$60m worth of TJX Companies stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component

2024

2023

Proportion (2024)

Salary

US$1.7m

US$1.7m

8%

Other

US$20m

US$19m

92%

Total Compensation

US$22m

US$21m

100%

Speaking on an industry level, nearly 17% of total compensation represents salary, while the remainder of 83% is other remuneration. TJX Companies pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
ceo-compensation

The TJX Companies, Inc.'s Growth

The TJX Companies, Inc. has seen its earnings per share (EPS) increase by 48% a year over the past three years. In the last year, its revenue is up 9.0%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has The TJX Companies, Inc. Been A Good Investment?

Boasting a total shareholder return of 58% over three years, The TJX Companies, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for TJX Companies that you should be aware of before investing.

Switching gears from TJX Companies, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.