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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Stock Farmer who wrote (57462)	2/11/2002 3:34:23 PM
From: RetiredNow	Respond to of 77400

We're agree on options. As far as dilution, I agree as well. As a shareholder, I hate that they give so many options out, which dilutes earnings and dilutes my stock price value, because I don't believe those employees are providing more value than they are being given. But having said that, if I take it as a given that they will continue to give them out, the very least they could do is contain the dilution from that, UNLESS they have a better way to bring value to the company. Currently, I see $20 billion on the books. To me this presents a very large agency issue. They can't invest in fast growing markets fast enough to turn money I've given them into more money for the company and for me. I don't like that. So if they can't invest that money fast enough, then the very least they could do is contain dilution, which they are doing. As such, management is doing their job. As far as you net benefit calculation, you forgot a major piece of that equation. The net benefit from the value supposedly derived for retaining the brightest minds in the industry. If Cisco didn't give out options, they'd probably have employees of the caliber of Nortel or Lucent. I shouldn't need to state the obvious, but given the current state of those businesses, I think it is fair to say that the Cisco team is doing a better job. That is worth something, which you are completely ignoring in your calculation of the $3.2 billion net liability. Is it worth $3.2 billion? I think it might be. Cisco has grown faster than all their competitors and are still number 1 in the market. That is due to a stellar team. Let's see if they can continue to do it.