The TJX Companies, Inc.'s (NYSE:TJX) CEO Compensation Is Looking A Bit Stretched At The Moment

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
• The overall pay is 62% above the industry average
• Over the past three years, TJX Companies' EPS grew by 48% and over the past three years, the total shareholder return was 58%

CEO Ernie Herrman has done a decent job of delivering relatively good performance at The TJX Companies, Inc. (NYSE:TJX) 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 want to keep CEO compensation within reason.

See our latest analysis for TJX Companies

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

According to our data, The TJX Companies, Inc. has a market capitalization of US$116b, and paid its CEO total annual compensation worth US$22m over the year to February 2024. Notably, that's an increase of 8.3% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.7m.

On comparing similar companies in the American Specialty Retail industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$14m. This suggests that Ernie Herrman is paid more than the median for the industry. What's more, Ernie Herrman holds US$60m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

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%

Talking in terms of the industry, salary represented approximately 17% of total compensation out of all the companies we analyzed, while other remuneration made up 83% of the pie. It's interesting to note that TJX Companies allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at The TJX Companies, Inc.'s Growth Numbers

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

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

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. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 1 warning sign for TJX Companies that investors should look into moving forward.

Important note: TJX Companies is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.