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.

Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: COMMON_SENSE who wrote (174400)	5/8/2003 1:06:11 PM
From: The Duke of URL©	Read Replies (1) \| Respond to of 186894

Please don't confuse disclosure of terms and details of the options and with deductabilty. Your posts become confusing and non-convincing. Your argument is that in order for you to understand options the firm must not only put full disclosure of the option terms in the notes to the financials, but also deduct them from income and then "deduct" them again as diluted eps. Criminentlies Mr. Wizard.......

To: COMMON_SENSE who wrote (174400)	5/8/2003 2:55:03 PM
From: Saturn V	Respond to of 186894

Why is dilution so hard to understand ? I am going to use round numbers for a hypothetical company X. For simplicity assume The Number of Company Shares Issued is 1 Million.( Should be Easy to find on any Income statement). Now find out number of outstanding options.[Easily available]. Assume that the number is 100,000. What is the present Earnings per Share ? Assume $1. What would have been the per Share Earnings if all the options were exercised immediately ? The answer is $1.00/1.1 = $0.89. [ The number of shares increased by 10%]. So by the dilution method the option expense is $0.11.