How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 483.03

+0.5%

Dec 5 9:30 AM EST

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To: Hawkmoon who wrote (41113)	4/4/2000 2:34:00 PM
From: Valley Girl	Read Replies (1) of 74651

Yes, others already pointed out my error re. the strike price, and I stand corrected. Re. the wage versus expense issue, my main problem with the critics are that they're making the classic error of double-counting. The treatment as an expense for tax purposes makes sense and benefits the company. From a market perspective, I don't think there's any other treatment that makes sense than to simply account for the dilution. If you count the options as an expense, thus reducing EPS, and then also divide that figure by the larger number of shares, you've counted the expense twice. If a company wants to pay employees entirely in stock, I don't really see a problem there. Tom Siebel effectively did this early in the company's life (pre-public); to save cash he allowed employees to take shares of stock in lieu of pay, worked out great for both Tom and his shareholders in the long run.

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