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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: L. Adam Latham who wrote (144202)	9/27/2001 4:15:31 PM
From: brushwud	Respond to of 186894

Shares for ESPP and stock option plans come out of a company's total authorized shares. Total authorized shares is not the same as total shares outstanding. Authorized shares may come into being in the future, but do not dilute the interest of existing shareholders in the present. Tech companies implement buy-back programs in part to counter the dilutive effects of these types of plans. In general, this is not true. Some do, and Intel is an example. In fact, those that don't need the cash obtained from these plans tend not to be the ones with the greatest growth opportunities. During Intel's salad days, they needed the cash from the ESPP and it was a significant source of funds to finance growth. If a company that relies heavily on stock options to retain talent didn't buy back shares, the dilutive effect on EPS would be a major problem as the years passed by. You're missing the most important point about stock options. They're not supposed to be a mere perquisite of employees, like raiding pens out of the supply cabinet or getting to visit your mom on a business trip. They're supposed to help attract and retain valuable talent, creating a win-win situation for both shareholders and optionees. If such is the case, there is no "dilutive effect", only accretive.