Intel Corporation (INTC) Message Board

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Technology Stocks : Intel Corporation (INTC)

INTC 36.85

+1.6%

Dec 19 3:59 PM EST

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To: Ali Chen who wrote (145898)	10/23/2001 12:22:07 PM
From: Noel	Read Replies (1) of 186894

Ali, RE: Stock buybacks I agree with your assessment regarding stock buybacks being the cost of doing business but I think that your model may be simplistic. These options were granted several years ago when Intel stock was presumably much lower. How do you account for that? The employees did benefit from the appreciation in stock but then so did the shareholders. I think it is fairer to account for stock options as an expense using Black-Sholes rather than as a stock buyback replacement. Also, the company gets to write off the taxes that the employee paid on appreciated stock which can be significant (believe me on this point :-(). This is how Cisco avoided paying income taxes for years inspite of very high income. Secondly, your assertion is true for the entire tech industry. Have you looked at the numbers for Microsoft, Cisco, Sun, etc.? I doubt they are very different. They may not be buying back as much stock as Intel but the stock dilution due to options still counts. How

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