Gorilla and King Portfolio Candidates Message Board

STOCKTALK

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 : Gorilla and King Portfolio Candidates

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: hueyone who wrote (52186)	7/18/2002 1:30:13 PM
From: A.L. Reagan	Read Replies (1) of 54805

Huey, to the extent options are issued and become exerciseable and the firm does not repurchase a corresponding number of shares, a free cash flow per share calculation should solve the problem provided the denominator is the fully diluted number of shares. Likewise, to the extent the firm repurchases shares, the funds used for the repurchase, net of proceeds for new share issuance on exercise, ought to be deducted from free cash flow prior to calculating FCF per share. The calculation I am suggesting should be neutral on FCF per share regardless of whether or not options are expensed. If they are expensed, the expense is a non-cash outlay. But where things get a little confusing is that the classic GAAP calculation of fully diluted shares doesn't necessarily take into account all issued option grants from day one. As Paul noted, the granularity of trying to make these adjustments over very short periods of time mightn't be worth it.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next