Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Casaubon who wrote (61021)	5/3/2002 10:27:39 AM
From: Boca_PETE	Read Replies (1) \| Respond to of 99280

Casaubon; RE("dilution to earnings is easy to calculate based on the number of outstanding options.") What you are referring to is FUTURE POTENTIAL DILUTION which is already taken into account in currently disclosed "DULUTED EARNINGS PER SHARE" under SFAS 128. What I am talking is CUMMULATIVE PAST DILUTION relating all past shares issued to employees on exercised stock options. The difference between what Earnings Per Share would have been without such share issuances and reported earnings per share is the crux of the real impact from stock option plans. Such as disclosed impact would certainly be huge for companies that over use options as employee compensation. Investors would see what would have been theirs. I know of no companies that disclose this impact since it is not required to be disclosed. I know of no current or past proposal to make such a disclosure. I realize that the current politically correct emotional call is to book an expense for stock options. But when one examines the cash flow realities of stock options, IMHO there is no method of valuing stock options that makes sense to quantify an expense for stock option grants because such options, by their terms, are not permitted to be transferred or traded by employees. P