American Homes 4 RentAMH
American Homes 4 Rent Stock Compensation Disclosure
Share-Based Compensation
2021 Equity Incentive Plan
In 2021, the Company’s shareholders approved and the Company adopted the 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan replaced the 2012 Equity Incentive Plan (the “2012 Plan”) and provides for the issuance of up to 9,544,095 Class A common shares (including shares that remained available for future awards under the 2012 Plan as of the effective date of the 2021 Plan and shares related to outstanding awards under the 2012 Plan that may become available after expiration, forfeiture or cancellation of such awards). The 2021 Plan provides for the issuance of Class A common shares through the grant of a variety of awards including stock options, stock appreciation rights, RSUs, unrestricted shares, dividend equivalent rights and performance-based awards. The 2021 Plan terminates in May 2031, unless terminated earlier by the Company’s board of trustees. When the Company issues Class A common shares under the 2012 Plan and 2021 Plan, the Operating Partnership issues an equivalent number of Class A units to AMH.
During the years ended December 31, 2025, 2024 and 2023, employees were granted RSUs that generally vest over a three-year service period and non-management trustees were granted RSUs that vest over a one-year service period. In addition, the Company granted Chris Lau, the Company’s Chief Financial Officer, 143,968 RSUs on February 21, 2024, which cliff vest five years from the date of grant. Options expire 10 years from the date of grant.
During the years ended December 31, 2025, 2024 and 2023, certain senior employees were granted PSUs that cliff vest at the end of a three-year service period based on satisfaction of performance conditions. The performance conditions of the PSUs are measured over the three-year performance period from January 1, 2025 through December 31, 2027 for PSUs granted during the year ended December 31, 2025, January 1, 2024 through December 31, 2026 for PSUs granted during the year ended December 31, 2024 and January 1, 2023 through December 31, 2025 for PSUs granted during the year ended December 31, 2023. A portion of the PSUs are based on (i) the achievement of relative total shareholder return compared to a specified peer group (the “TSR Awards”), and a portion are based on (ii) average annual growth in core funds from operations per share (the “Core FFO Awards”). The number of PSUs that may ultimately vest range from zero to 200% of the number of PSUs granted based on the level of achievement of these performance conditions. For the TSR Awards, grant date fair value was determined using a multifactor Monte Carlo model and the resulting compensation cost is amortized over the service period regardless of whether the performance condition is achieved. For the Core FFO Awards, fair value is based on the market value on the date of grant and compensation cost is recognized based on the probable achievement of the performance condition at each reporting period.
The 2012 Plan and 2021 Plan allow for continued release of awards based on the original vesting schedule, rather than forfeiture, of unvested share-based grants upon termination of service for employees who meet certain retirement eligibility criteria, including age and years of service. Retirement eligible employees must also provide a notice of intent to retire at least six months prior to retirement date and the HCC Committee must approve the continued release of awards.
The following table summarizes stock option activity under the 2012 Plan and 2021 Plan for the years ended December 31, 2025, 2024 and 2023:
| Shares | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Life (in years) | Aggregate Intrinsic Value (1) (amounts in thousands) | |||||||||||||||||||||||
| Options outstanding at December 31, 2022 | 730,550 | $ | 17.97 | 3.0 | $ | 8,889 | ||||||||||||||||||||
| Granted | — | — | — | |||||||||||||||||||||||
| Exercised | (207,875) | 16.76 | 3,852 | |||||||||||||||||||||||
| Forfeited | — | — | — | |||||||||||||||||||||||
| Options outstanding at December 31, 2023 | 522,675 | $ | 18.45 | 2.5 | $ | 9,150 | ||||||||||||||||||||
| Granted | — | — | — | |||||||||||||||||||||||
| Exercised | (193,175) | 16.11 | 4,019 | |||||||||||||||||||||||
| Forfeited | — | — | — | |||||||||||||||||||||||
| Options outstanding at December 31, 2024 | 329,500 | $ | 19.83 | 2.1 | $ | 5,796 | ||||||||||||||||||||
| Granted | — | — | — | |||||||||||||||||||||||
| Exercised | (139,000) | 18.11 | 2,551 | |||||||||||||||||||||||
| Forfeited | — | — | — | |||||||||||||||||||||||
| Options outstanding at December 31, 2025 | 190,500 | $ | 21.09 | 1.4 | $ | 2,098 | ||||||||||||||||||||
| Options exercisable at December 31, 2025 | 190,500 | $ | 21.09 | 1.4 | $ | 2,098 | ||||||||||||||||||||
(1)Intrinsic value for activities other than exercises is defined as the difference between the grant price and the market value on the last trading day of the period for those stock options where the market value is greater than the grant price. For exercises, intrinsic value is defined as the difference between the grant price and the market value on the date of exercise.
The following table summarizes RSU activity under the 2012 Plan and 2021 Plan for the years ended December 31, 2025, 2024 and 2023:
| Restricted Share Units | Weighted- Average Grant Date Fair Value | |||||||||||||
| RSUs outstanding at December 31, 2022 | 1,024,722 | $ | 33.99 | |||||||||||
| Granted | 509,730 | 33.24 | ||||||||||||
| Vested | (418,351) | 31.40 | ||||||||||||
| Forfeited | (25,579) | 33.45 | ||||||||||||
| RSUs outstanding at December 31, 2023 | 1,090,522 | $ | 34.64 | |||||||||||
| Granted | 701,342 | 35.70 | ||||||||||||
| Vested | (559,257) | 33.80 | ||||||||||||
| Forfeited | (45,063) | 34.85 | ||||||||||||
| RSUs outstanding at December 31, 2024 | 1,187,544 | $ | 35.66 | |||||||||||
| Granted | 514,636 | 36.42 | ||||||||||||
| Vested | (559,079) | 36.34 | ||||||||||||
| Forfeited | (34,822) | 35.69 | ||||||||||||
| RSUs outstanding at December 31, 2025 | 1,108,279 | $ | 35.66 | |||||||||||
The following table summarizes PSU activity under the 2012 Plan and 2021 Plan for the years ended December 31, 2025, 2024 and 2023:
Performance-Based Restricted Share Units (1) | Weighted-Average Grant Date Fair Value | |||||||||||||
| PSUs outstanding at December 31, 2022 | 294,423 | $ | 41.07 | |||||||||||
| Granted | 227,033 | 40.19 | ||||||||||||
| Vested | — | — | ||||||||||||
| Forfeited | (1,237) | 43.91 | ||||||||||||
| PSUs outstanding at December 31, 2023 | 520,219 | $ | 40.68 | |||||||||||
| Granted | 254,157 | 41.46 | ||||||||||||
| Adjustment for performance achievement | 75,109 | 34.83 | ||||||||||||
| Vested | (167,428) | 34.83 | ||||||||||||
| Forfeited | (4,759) | 41.51 | ||||||||||||
| PSUs outstanding at December 31, 2024 | 677,298 | $ | 41.76 | |||||||||||
| Granted | 227,616 | 43.18 | ||||||||||||
| Adjustment for performance achievement | 170,757 | 43.99 | ||||||||||||
| Vested | (370,854) | 43.99 | ||||||||||||
| Forfeited | (4,044) | 41.62 | ||||||||||||
| PSUs outstanding at December 31, 2025 | 700,773 | $ | 41.39 | |||||||||||
(1)Represents the number of target shares at grant date for PSUs outstanding, granted and forfeited. Adjustment for performance achievement represents the difference between the number of target shares at grant date and the number of actual shares earned for the three-year performance period ended December 31, 2024 and 2023, which was determined and vested during the first quarters of 2025 and 2024, respectively.
For the TSR Awards, the following assumptions were used in the calculation of fair value using the Monte Carlo simulation model:
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Expected term (years) | 3.0 | 3.0 | 3.0 | |||||||||||||||||
| Dividend yield | 2.83% | 2.44% | 2.09% | |||||||||||||||||
Estimated volatility (1) | 22.48% | 23.83% | 27.45% | |||||||||||||||||
| Risk-free interest rate | 4.49% | 4.19% | 4.16% | |||||||||||||||||
(1)Estimated volatility for the performance period is based on 50% historical volatility and 50% implied volatility.
2021 Employee Stock Purchase Plan
The 2021 ESPP provides for the issuance of up to 3,000,000 Class A common shares and allows employees to acquire the Company’s Class A common shares through payroll deductions, subject to maximum purchase limitations, during six-month purchase periods. The purchase price for Class A common shares may be set at a maximum discount equal to 85% of the lower of the closing price of the Company’s Class A common shares on the first day or the last day of the applicable purchase period. The 2021 ESPP terminates in June 2031 or the date on which there are no longer any Class A common shares available for issuance. When the Company issues Class A common shares under the 2021 ESPP, the Operating Partnership issues an equivalent number of Class A units to AMH.
Share-Based Compensation Expense
The Company’s noncash share-based compensation expense relating to corporate administrative employees is included in general and administrative expense and the noncash share-based compensation expense relating to centralized and field property management employees is included in property management expenses. Noncash share-based compensation expense relating to employees involved in the purchases of single-family properties, including newly constructed properties from third-party builders, the development of single-family properties, or the disposal of certain properties or portfolios of properties is included in acquisition and other transaction costs. The following table summarizes the activity related to the Company’s noncash share-based compensation expense for the years ended December 31, 2025, 2024 and 2023 (amounts in thousands):
| For the Years Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| General and administrative expense | $ | 16,078 | $ | 20,617 | $ | 16,379 | ||||||||||||||
| Property management expenses | 4,090 | 4,814 | 4,030 | |||||||||||||||||
| Acquisition and other transaction costs | 5,647 | 5,553 | 4,961 | |||||||||||||||||
| Total noncash share-based compensation expense | $ | 25,815 | $ | 30,984 | $ | 25,370 | ||||||||||||||
As of December 31, 2025, the unrecognized compensation expense for unvested RSUs and PSUs was $19.0 million and $8.3 million, respectively. The unrecognized compensation expense for unvested RSUs and PSUs is expected to be recognized over a weighted-average period of 1.6 years and 1.2 years, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 20, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 25, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 28, 2020 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.