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Technology Stocks : Cisco Systems, Inc. (CSCO)
CSCO 78.32-0.1%Jan 30 9:30 AM EST

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To: GVTucker who wrote (63395)3/18/2003 1:16:47 PM
From: Lizzie Tudor  Read Replies (1) of 77400
 
thats the impression your post is giving me. I didn't get any answers from anybody else on this issue.

But if you don't mean to infer my assumptions, how about yet one more clarification-

- assume a "hot" IPO making less than 5 million earnings/qtr
- 70mm or so options expenses (minimum) on the annual rpt, resulting in a large net loss for the quarter of IPO

Who exactly do you think will be affected by this?

Come on, lets not kid ourselves that IPOs with huge net losses related to options expensing is irrelevant and not going to effect *anybody's* valuation wrt the company. Maybe it won't effect the bankers (although I personally don't believe this)... but what about individuals, after all isn't this entire exercise of options expensing supposed to provide clarity to investors?

Can we just let any unprofitable IPO out the door again do you think? If not, should we treat options expenses as some different sort of expense then, in other words unprofitable companies that are only unprofitable due to options *can* IPO but others that are just plain unprofitable cannot? If thats the case, it looks like these things should be proforma'd out then. But wait- thats not what I was hearing in the past. Tough problem!
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