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In a recent development, TXNM Energy Inc., an electric services provider formerly known as PNM Resources Inc., has announced the approval of new compensatory arrangements for its named executive officers. With a market capitalization of $4.6 billion and a track record of 30 consecutive years of dividend payments, TXNM has demonstrated strong financial stability. According to InvestingPro data, the company generated revenues of $1.97 billion in the last twelve months. The Board of Directors and the Compensation and Human Capital Committee finalized these plans on Monday, February 24, 2025.
The company’s 2025 Officer Annual Incentive Plan, which began on January 1, 2025, and concludes on December 31, 2025, allows for cash bonuses based on the achievement of specific performance goals, including Incentive Earnings Per Share. With current diluted EPS at $2.67 and analysts forecasting $2.86 for FY2025, the company shows promising growth potential. The plan stipulates that no bonuses will be awarded unless a minimum earnings target is met. For deeper insights into TXNM’s financial metrics and growth prospects, InvestingPro subscribers have access to over 30 additional key indicators and exclusive analysis. The potential bonuses range from 32.5% to 230% of the executive officers’ base salaries, depending on their roles and the achievement of corporate goals.
Additionally, the 2025 Long-Term Incentive Plan (2025 LTIP) was approved, offering a mix of performance share awards and time-vested restricted stock rights. The LTIP, covering a three-year period from January 1, 2025, to December 31, 2027, allocates 70% of total award opportunities to performance share awards and 30% to time-vested restricted stock rights. The performance share awards are contingent on meeting earnings growth, relative total shareholder return, and funds from operations/debt ratio goals.
The Board also decided to change the grant timing for time-vested restricted stock rights, moving away from past practices. As a result, the Board will not grant the time-vested restricted stock rights component of the 2022 Long-Term Incentive Plan that was initially scheduled for February 2025.
Furthermore, amendments were made to the 2023 and 2024 Long-Term Incentive Plans to exclude the impact of extraordinary events occurring after February 25, 2025, when calculating the funds from operations/debt ratio goal.
The company’s statement clarifies that the non-GAAP financial measures used for these plans are specifically for internal performance measurement and may differ from any public earnings guidance. Detailed information about these performance measures will be provided in future proxy statements for Annual Meetings of Stockholders, as per SEC regulations.
The announcement of these compensation plans is based on a press release statement and reflects TXNM Energy Inc.’s efforts to align executive compensation with company performance and shareholder interests. The company’s commitment to shareholder value is evident in its 13-year streak of consecutive dividend increases, with a current dividend yield of 3.15%. InvestingPro analysis reveals 8 additional key insights about TXNM’s financial health and market position, available exclusively to subscribers through comprehensive Pro Research Reports.
In other recent news, TXNM Energy reported its fourth-quarter 2024 earnings, which fell short of expectations. The company posted earnings per share (EPS) of $0.30, missing the forecasted $0.32, while revenue came in at $476.96 million, significantly below the anticipated $563.75 million. Despite this, TXNM Energy announced a 5% increase in its dividend and a boost in its capital investment plan to $7.8 billion, signaling its commitment to growth and shareholder returns. Evercore ISI recently raised its price target for TXNM Energy to $57, citing expected earnings growth and strong regulatory strategies. The firm maintained an Outperform rating, highlighting the company’s effective management of regulatory challenges and potential risks, such as wildfires. Additionally, TXNM Energy declared a regular quarterly dividend of $0.4075 per share, further emphasizing its financial stability. These developments reflect the company’s strategic focus on expanding its market presence and infrastructure investments in Texas and New Mexico.
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