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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Mike Buckley who wrote (50496)2/25/2002 12:52:09 AM
From: EnricoPalazzo  Read Replies (1) of 54805
 
But I think it's a huge stretch to say that high-tech companies can't survive unless they offer stock options to their employees.

Well, yes and no. SAP (the example you cite) is a german company, and thus competes in a different labor market (I'm aware that SAP has some US employees).

My point is that given that most US high-tech companies give out options, we're not going to find many Gorillas (or candidates) worthy of investing in that don't give out options. Given that, I don't pay too much attention to it.

Certainly, at some point in the future (e.g. if the stock market stays in the doldrums for a long period of time), employers may well move towards a more cash-based compensation plan (in fact, Microsoft has been unofficially moving in this direction for several years).

But at the end of the day, I don't see stock options as a major factor in which companies we should invest in, which is all I care about (in the context of this thread anyway).

As for whether congress will change the law and will it affect valuation? Well, I guess it might, but I don't handicap legislation (I've tried my hand at handicapping court rulings w/ RMBS, and you know how that went...). Sounds like rule #10 stuff to me.

Ethan
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