Form 4: Huntington Ingalls Industries Executive Paul C. Harris Reports Stock Transactions

Paul C. Harris, an Executive Vice President & Chief Sustainability Officer at Huntington Ingalls Industries, reports acquisition and disposal of company stock related to restricted performance stock rights.

Summary

• On February 24, 2025, Paul C. Harris acquired 2,476 shares of Huntington Ingalls Industries common stock at a price of $168.81 per share due to the settlement of restricted performance stock rights.
• On the same day, 1,145.636 shares were withheld by the issuer for payment of withholding taxes related to these RPSRs at $168.81 per share.
• Following these transactions, Harris directly owns 3,477.344 shares of common stock.
• Harris also acquired 799 restricted stock rights (RSRs) which vest ratably over three years from the grant date of February 24, 2025.
• Each RSR represents a contingent right to receive one share of company common stock, cash, or a combination thereof, at the discretion of the Company's Compensation Committee.

Sentiment

Score: 7

Explanation: The document reflects standard executive compensation practices, which are generally viewed neutrally to positively as they align management interests with shareholder value. The transactions themselves are routine and expected.

Positives

• The acquisition of shares through RPSR settlement indicates a form of compensation and alignment of the executive's interests with the company's performance.
• The vesting schedule of the RSRs encourages long-term commitment from the executive.

Future Outlook

The RSRs vest ratably in three equal installments upon each of the first, second and third anniversaries of the grant date, suggesting continued equity-based compensation for the reporting person.

Industry Context

Executive compensation through stock and stock rights is a common practice in publicly traded companies to align management's interests with those of shareholders. The vesting schedule encourages long-term commitment and performance.

Comparison to Industry Standards

• Stock-based compensation is a standard practice among publicly traded companies, particularly in the defense industry, to incentivize executives.
• Companies like Lockheed Martin (LMT) and General Dynamics (GD) also utilize restricted stock units and performance-based equity awards as part of their executive compensation packages.
• The vesting schedules and performance metrics associated with these awards often vary based on company-specific goals and industry benchmarks.

Stakeholder Impact

• The transactions have a minor impact on shareholders, reflecting standard executive compensation practices.
• Employees may view the executive's stock ownership positively, as it aligns leadership's interests with the company's success.

Key Dates