SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: hueyone who wrote (99)6/21/2002 2:38:34 AM
From: ExacctntRead Replies (1) of 786
 
<<<If stock option compensation was charged directly against net income, (instead of being reflected in diluted earnings per share--- if it is), it seems to me that this might have a chance of reversing the unfortunate trend of stock option compensation spiralling wildly upward and out of control and possibly reversing the trend of the ever widening divergence between insider shareholder interests and outside shareholder interests. >>>

How and when to expense stock option costs may depend upon the ultimate purpose of reform. If the general opinion favors expensing to reign in excessive granting of options then higher expense methods such as using the difference between exercise price vs market when the option is exercised could be used. If the purpose of reform is to provide a useful estimate, then Black Scholes would be useful.

Any method used has flaws. Every company is different in how they handle their option programs. One thing has changed however, most companies now have massive grants that are out-of-the-money. Because of this occurrence, in my opinion, the worst excesses of option gains is over. As usual we are attempting to shut the gate after the horses have left. That doesn't mean that in a misguided attempt to compensate employees and themselves for all the under water options that have been granted, that companies grant even higher numbers of options in the future.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News