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

To: Stock Farmer who wrote (122039)	7/24/2002 11:20:03 AM
From: Elroy	Read Replies (1) \| Respond to of 152472

A few comments About future earnings. Most of us use analysts consensus forward earnings projections. Their models include projections of increases in diluted share counts. So the forward earnings you are using to make your investment decision DO include dilution assumptions. The company only publishes in-the-money vested options. Not unvested options. Or options underwater. You sure about this? Well if in the money vested options are the only ones that affect the diluted share count, then that is the area of accounting that should be changed. All issued options should have some affect on diluted share count, and the affect should be dependent on the options strike versus the share price at the time of counting and the stock's volatility. Not the operating expense line. Like I said, if the company uses treasury shares to fulfill employees exercising options, the only "cost" is in the dilution. That's where it makes the most sense to measure it (at least to me). Elroy

To: Stock Farmer who wrote (122039)	7/27/2002 10:59:00 PM
From: rkral	Respond to of 152472

OT ... The second point is that stock options granted this year don't even show up in diluted EPS figures. John, imo you are mistaken here too. Per paragraph 19 of FAS 128 "Earnings per Share": "Dilutive options or warrants that are issued during a period or expire or are canceled during a period shall be included in the denominator of diluted EPS for the period that they were outstanding." The above means the impact of newly issued ITM options is time-weighted, e.g., 100,000 shares granted at the beginning of the 2nd fiscal quarter is counted as 75,000 shares for the fiscal year. Ron