Form 4: HII CFO's Stock Transactions: RSR Settlement & New Grant

Huntington Ingalls Industries' Executive VP and CFO, Thomas E. Stiehle, reported the settlement of restricted performance stock rights and the grant of new restricted stock rights.

Summary

• Thomas E. Stiehle, Executive VP and CFO of Huntington Ingalls Industries, Inc. (HII), reported changes in his beneficial ownership.
• Acquired 8,440 shares of common stock on February 25, 2026, from the settlement of restricted performance stock rights (RPSRs) for the performance period that ended on December 31, 2025.
• Disposed of 3,806.44 shares of common stock on the same date, which were withheld by the issuer for payment of withholding taxes related to the RPSR settlement.
• Acquired 1,239 Restricted Stock Rights (RSRs) on February 25, 2026, under the 2022 Long-Term Incentive Stock Plan (LTISP).
• Each RSR represents a contingent right to receive an equivalent number of common shares, cash, or a combination, vesting ratably over three years from the grant date.
• Following these transactions, Mr. Stiehle beneficially owns 29,156.742 shares of common stock and 4,499.422 Restricted Stock Rights.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive, routine compensation event that aligns executive incentives with long-term company performance and shareholder value, reflecting the successful achievement of prior performance targets.

Positives

• Settlement of Restricted Performance Stock Rights (RPSRs) indicates that performance targets for the period ending December 31, 2025, were met, leading to the issuance of common stock.
• The grant of new Restricted Stock Rights (RSRs) aligns management incentives with the company's long-term performance and shareholder value creation.

Negatives

• Disposal of 3,806.44 shares for tax withholding reduces the direct common stock ownership, though this is a standard practice for equity compensation.

Future Outlook

The newly granted Restricted Stock Rights (RSRs) will vest ratably over three years, indicating a long-term incentive structure for the Executive VP and CFO, aligning future compensation with company performance through February 2029.

Industry Context

StockSavvy.ai notes that equity compensation, particularly through restricted stock units or rights, is a common practice in the defense and shipbuilding industry, similar to other large industrial companies. This mechanism is widely used to retain key executives and align their interests with long-term shareholder value creation, a trend observed across peers like Lockheed Martin and General Dynamics.

Comparison to Industry Standards

• The use of Restricted Stock Rights (RSRs) and Restricted Performance Stock Rights (RPSRs) is a standard executive compensation practice, comparable to programs at major defense contractors such as Lockheed Martin, Raytheon Technologies, and Northrop Grumman, which also utilize performance-based equity awards to incentivize long-term executive performance.
• The vesting schedule of three equal annual installments for the new RSRs is a common structure designed to promote executive retention and sustained performance over several years, consistent with industry benchmarks for executive equity grants.

Stakeholder Impact

• Shareholders: The grant of new equity awards to a key executive aligns management's interests with long-term shareholder value creation.
• Employees: Reflects the company's ongoing executive compensation strategy, potentially setting a precedent for other senior roles.

Next Steps

• The newly granted Restricted Stock Rights (RSRs) will vest in three equal installments on the first, second, and third anniversaries of the grant date (February 25, 2026).

Key Dates

Recommendation

This Form 4 filing details routine executive compensation events, including the settlement of performance-based awards and the grant of new long-term incentives. These transactions are expected and do not provide new information that would alter the fundamental investment thesis for Huntington Ingalls Industries. Therefore, a 'hold' recommendation is appropriate as the filing does not present a catalyst for significant price movement.

Keywords

Huntington Ingalls Industries, HII, Form 4, Insider Transaction, Stock Grant, Restricted Stock Rights, RPSRs, CFO, Executive Compensation, Equity Compensation