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Technology Stocks : How high will Microsoft fly?
MSFT 483.65-0.8%Dec 31 3:59 PM EST
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To: jonkai who wrote (71308)7/18/2002 6:42:41 PM
From: sandeep  Read Replies (2) of 74651
 
Jonkai, can you reconcile some of the discrepancy I observed in your post?

23. MSFT has 802 million options outstanding, if it wanted to keep from diluting its share count any more, it would need to buy back $40 billion worth of stock, yet it only has $36 billion to do it (current assets minus current liabilities)..... see any problems yet? that means guaranteed dilution, on top of that, MSFT granted for example 650 million options in the last 3 and 1/2 years.

I assume that you believe that MSFT has to buy 802 million shares to avoid dilution. But if 650 million of those had been granted in the last 4 years and are mostly outstanding, then clearly, no purchases need to be made to avoid dilution for those options. None of these option grants can be lower than the current stock price, can it?

Thanks for your enumerations of reasons for MSFT's decline.
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