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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (116211)	3/29/2002 12:57:13 PM
From: Rocket Scientist	Read Replies (2) \| Respond to of 152472

<<as for the options issuance, you point out a figure of 2% from last year, but it might be worthwhile to take a moving average of multiple years (like the last 5 years)>> If I read the 14A's correctly, QCOM's option grants (adjusted for stock splits) were about as follows: FY Shares O/S NEO Total Grants Grants Dilution(%) 1996 532 4.16 47.2 8.9 1997 548 0.8 2.4 1.2 1998 566 8.08 16.6 8.6 1999 702 ----- --- ---- 2000 725 1.14 11.9 1.3 2001 766 1.49 9.5 2.0 <<your idea of equating dilution to 10% of EPS is very creative>> well, I picked it to force agreement with your 3% figure during the years when EPS is assumed to be growing fast (30% per year). It's arbitrary, for sure....but my point is that it's not reasonable to assume, as your 30 yr model does, that QCOM after 10 years will produce flat earnings relative to the economy, but issue options at a rate commensurate with a growth stock. It will either grow earnings fast (offset by some dilution due to options) or become more of a cyclical stock with lower dilution (and probably lower R&D expense as well!)