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Technology Stocks : Intel Corporation (INTC)
INTC 41.41+2.2%Dec 5 9:30 AM EST
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To: NITT who wrote (177795)5/6/2004 10:59:20 AM
From: rkral   of 186894
 
OT ... Nitt, re "that argues for disclosure of the detail of the grants"
Option info from Intel's 2003 10-K ...

                      Outstanding           Exercisable
                ------------------------  -----------------
Exercise(range) Shares   Life   Exercise  Shares   Exercise
$ 0.01-$17.40    115.4    3.0    $  8.57    94.3    $  7.13 
$17.41–$20.17    193.6    6.3    $ 18.48   103.2    $ 18.34 
$20.23–$24.35    263.1    8.0    $ 22.38    37.6    $ 20.97 
$24.37–$31.35    126.6    7.1    $ 28.63    46.9    $ 26.44 
$31.37–$45.16     70.4    7.1    $ 37.06    30.5    $ 38.46 
$45.96–$87.90     81.0    6.3    $ 61.96    15.0    $ 63.74 
-----------------------------------------------------------
Total            850.1    6.5    $ 25.54   327.5    $ 20.53

IMO that's already more detail than most people care to deal with. You want more?

re "not some value established by a bunch of gamblers"
Agreed that there is a bit of gambling involved, but it's the use of options, not in establishing a value for them.

re "there will be a much greater opportunity for companies to "fudge" the numbers"
To establish the value per option pricing models, e.g., Black-Scholes, several estimates must be made. The opportunity to make such estimates pessimistically or optimistically, particularly re stock price volatility and option life, is hardly an excuse for not making them and not expensing IMO.

re "a greater opportunity for all those lawsuit mills to bring investor lawsuits claiming the expense numbers were incorrect"
I've seen no evidence for such conjecture. It's a red-herring, a scare tactic espoused by the anti-option-expensing crowd IMO. You've apparently swallowed the Craig Barrett line .. hook, line, and sinker.

Ron
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