Titan Machinery Inc.TITN
Titan Machinery Inc. Stock Compensation Disclosure
STOCK-BASED COMPENSATION
Stock-Based Compensation Plans
The Company has one stock-based compensation plan, the Second Amended and Restated Titan Machinery Inc. 2014 Equity Incentive Plan (the "2014 Equity Incentive Plan"), to provide incentive compensation to participants for services that have been or will be performed for continuing as employees or members of the Board of Directors of the Company. Under the 2014 Equity Incentive Plan, which has been approved by the stockholders of the Company, the Company may grant stock-based awards for up to a maximum number of shares of common stock set forth in the 2014 Equity Incentive Plan under specified forms of equity award types. Shares issued for stock-based awards consist of authorized but unissued shares. As of January 31, 2026, the Company had 743,341 shares authorized and available for future equity awards under the 2014 Equity Incentive Plan.
Compensation cost arising from stock-based compensation and charged to operations was $5.9 million, $4.4 million and $3.3 million for the years ended January 31, 2026, 2025 and 2024, respectively. The related income tax benefit (net) was $1.2 million, $1.1 million and $1.1 million for the years ended January 31, 2026, 2025 and 2024, respectively.
Restricted Stock Awards ("RSAs")
The Company grants RSAs as part of its long-term incentive compensation to employees and members of the Board of Directors of the Company. The fair value of these awards is determined based on the closing market price of the Company's
stock on the date of grant. The RSAs primarily vest over a period of approximately years for employees and over year for members of the Board of Directors. The Company recognizes compensation expense ratably over the vesting period of the award. The restricted common stock underlying these awards are deemed issued and outstanding upon grant and carry the same voting and dividend rights of unrestricted outstanding common stock, provided that any dividends paid are subject to a right of forfeiture until the underlying RSA has vested.
The following table summarizes RSA activity for the year ended January 31, 2026:
| Shares | Weighted Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
| Nonvested at January 31, 2025 | 493 | $ | 21.63 | ||||||||
| Granted | 290 | 18.51 | |||||||||
| Forfeited | (194) | 22.27 | |||||||||
| Vested | (10) | 20.02 | |||||||||
| Nonvested at January 31, 2026 | 579 | $ | 19.88 | ||||||||
The weighted-average grant date fair value of RSAs granted was $18.51, $18.22 and $26.48 during the years ended January 31, 2026, 2025 and 2024, respectively. The total fair value of RSAs vested was $3.4 million, $3.4 million and $3.7 million during the years ended January 31, 2026, 2025 and 2024, respectively. As of January 31, 2026, there was $7.4 million of unrecognized compensation cost related to nonvested RSAs that is expected to be recognized over a weighted-average period of 2.1 years.
Restricted Stock Units ("RSUs")
The Company grants RSUs as part of its long-term incentive compensation to certain employees of the Company in our European operations. The fair value of these awards is determined based on the closing market price of the Company's common stock on the date of grant. The RSUs primarily vest over a period of approximately years. The Company recognizes compensation expense ratably over the vesting period of the award. The common stock underlying these awards are not deemed issued or outstanding upon grant, and do not carry any voting or dividend rights.
The following table summarizes RSU activity for the year ended January 31, 2026:
| Shares | Weighted Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
| Nonvested at January 31, 2025 | 12 | $ | 22.82 | ||||||||
| Granted | 6 | 18.51 | |||||||||
| Vested | (3) | 28.24 | |||||||||
| Nonvested at January 31, 2026 | 15 | $ | 20.16 | ||||||||
The weighted-average grant date fair value of RSUs granted was $18.51, $18.20, and $26.47 for the fiscal years ended January 31, 2026, 2025, and 2024, respectively. As of January 31, 2026, there was $0.2 million of unrecognized compensation cost related to nonvested RSUs that is expected to be recognized over a weighted-average period of 2.3 years.
Long-Term Cash Incentive Awards
The Company grants long-term cash incentive awards as part of its long-term incentive compensation to certain international employees of the Company. The awards vest over a period of approximately four years and entitle the award recipient to a cash payment on the vesting date equal to the number of vested shares multiplied by the stock price of the Company on the date of vesting. These awards are liability-classified share-based payment awards in which fair value of the award is remeasured at each period until the liability is settled. Fair value of these awards is determined based on the closing price of the Company's stock as of the end of each reporting period. Changes in the fair value of the liability are recognized as compensation cost over the requisite service period. The percentage of the fair value that is accrued as compensation cost at the end of each period is equal to the percentage of the requisite service that has been rendered at that date.
The following table summarizes activity for long-term cash incentive awards for the year ended January 31, 2026:
| Shares | Weighted Average Grant Date Fair Value | ||||||||||
| (in thousands) | |||||||||||
| Nonvested at January 31, 2025 | 48 | $ | 21.50 | ||||||||
| Granted | 24 | 18.51 | |||||||||
| Forfeited | (1) | 21.00 | |||||||||
| Vested | (15) | 23.28 | |||||||||
| Nonvested at January 31, 2026 | 56 | $ | 19.68 | ||||||||
The weighted-average grant date fair value of long-term cash incentive awards granted was $18.51 during the year ended January 31, 2026. As of January 31, 2026, based on the Company's stock price on that day, there was $0.4 million of unrecognized compensation cost related to nonvested awards that is expected to be recognized over a weighted-average period of 1.3 years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Mar 31, 2026 | Showing above |
| 2025 | Apr 7, 2025 | |
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.