Intel Corporation (INTC) Message Board

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Technology Stocks : Intel Corporation (INTC)

INTC 37.52

-0.8%

3:59 PM EST

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To: bundashus who wrote (66567)	10/14/1998 1:48:00 AM
From: Joe NYC	Read Replies (1) of 186894

bundashus, Don't companies buy back it shares because management thinks that is best investment for its shareholders? If you shift your costs from paying employees salary to paying them stock options, you eventually have to buy stock when the employees redeem their option for stock. The only problem is that you have to buy stock at market prices, while employees pay peanuts, resulting in expenditures like the $1.7 billion you saw this quarter. But hopefully, Intel bought more shares than needed to cover the option liability. So mostly, the stock buy back is not an investment, but the cost of running the business, and if you want to calculate the real earnings, wait for the 10-Q, calculate the cost of stock options this quarter, subtract from the current earnings. Joe

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