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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: David Howe who wrote (72155)	8/14/2002 4:08:46 PM
From: Charles Tutt	Respond to of 74651

I think a lot depends on how the new judge rules. Perhaps we'll know soon. Charles Tutt (SM)

To: David Howe who wrote (72155)	8/14/2002 4:13:12 PM
From: ProDeath	Read Replies (1) \| Respond to of 74651

$65? Not unless inflation kicks in big time, so it seems doubtful. I wonder what options grants will look like when the stock hits 30.

To: David Howe who wrote (72155)	8/15/2002 12:40:25 PM
From: John F. Dowd	Read Replies (1) \| Respond to of 74651

DH: Everyone makes the comment about dilution with respect to market. Where does market value appear on the balance sheet? There are a lot of issues at play here. A lot of people look at options as if the grantee is 1. not paying in anything and 2, if he were to flip the shares that some one would not buy them at the market and 3. the company is not buying and retiring shares or making treasury shares of them. This whole debate has really been a lot of cocktail party talk to date. If the cash coming into the treasury is above book and if the company buys back the offsetting amount then the cost to the company at the time of exercise is the difference between say the avg. cost to buy back and the amount received from the grantees. Now as long as the share price paid is greater than book there is no dilution to book but there is dilution via shares outstanding and thus to EPS except and unless an equal amount of shares are purchased by the company. On the other hand to me the best measurement of a company, especially one with no debt, is the speed with which they are building cash. But we never know the impact on this until the time of exercise. It is this cash cost that is the real cost, the rest is baloney. JFD

To: David Howe who wrote (72155)	8/15/2002 2:58:10 PM
From: jonkai	Respond to of 74651

If the stock goes up, it's a "feasible prospect". The lowest option grant was around $54 (just recently). Most are above $62. So, yes, if the stock goes UP there is modest dilution due to option grants; which MSFT counters with stock buy-backs. you don't know what you are talking about.... MSFT lists their options and their grants and their buy backs..... the first thing you understand if you actually look at the numbers is MSFT doesn't buy back ANY WHERE NEAR what the dilution is.....(600 million shares diluting basic share count in the last five years, ON TOP OF ALL BUY BACKS TO DATE). and then if you are slightly brighter than a superball.... you'll actually see a lot more options at much lower prices than even $43 a share... jon.