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Technology Stocks : Altaba Inc. (formerly Yahoo) -- Ignore unavailable to you. Want to Upgrade?

To: fut_trade who wrote (5350)12/30/1997 10:55:00 PM
From: Rio Jangada  Read Replies (3) | Respond to of 27307
 
"The use of stock options is to attract and retain first-rate employees -- who lead the company into the future. All of the top companies do this."

No doubt! I just want to point out that although Yahoo revenues and perhaps earnings are rapidly advancing so too is the number of outstanding shares (See the SI profile). So the prospect of attaining a respectable P/E ratio gets extended further and further into the future. (Unless of course there is a significant drop in stock price.) This is in contrast with many large-cap profit-making enterprises like IBM and DELL that are actually reducing the number of shares outstanding.

RJ



To: fut_trade who wrote (5350)12/30/1997 11:00:00 PM
From: Keith J  Read Replies (1) | Respond to of 27307
 
Yeah, but the established companies don't issue new shares to pay for their options, they buy back stock to use for employee options. Um, YHOO could use all their cash and not even come close to doing this. I don't think it's a concern that some options are granted, but the amount (over 10% of shares outstanding). And, of course, this number will grow as new options are granted to attract and retain employees, further diluting the stock value.

KJ


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