Franco, thanks for the kind words. A question, if the companies in question did not buy back their shares, would these options still be granted? I presume these will and the dilution rate of the current stock holders would simply be greater, thus by buying back shares in the open market, those companies , instead of paying a billion to stock holders as dividends (which would retain only about $640 MM since the rest will be paid out as taxes), buys back shares, and let say for argument purposes, that these shares represent 1% of the total capitalization, the dividend rate is not 1%, but in most cases very close to 1.5% pretax. In essence it is a "stock dividend". Whether or not the companies have a stock option plan, is a secondary impact, since there are more companies with outsized option plans that do not buy back shares, than those that do.
Zeev |
