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Technology Stocks : Intel Corporation (INTC)
INTC 47.82+1.1%12:57 PM EST

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To: AK2004 who wrote (183116)1/18/2006 3:38:51 AM
From: Tenchusatsu  Read Replies (1) of 186894
 
AK, Option grants should be measured against stock performance that is against expected earnings and earnings growth or, if you will, risk adjusted present value of future distributable earnings.

Unfortunately for you, options aren't measured against that. Instead, they're measured against the actual earnings of the company at the time of grant, not the "expected earnings" and not the "earnings growth." And that is done by counting it as an "expense," even though like Duke said, this isn't a real expense.

So taking that method of expensing options, AMD looks a lot worse than Intel. If you want to argue against that method, be my guest. You'll just be agreeing with what I've been saying all along.

Tenchusatsu
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