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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host -- Ignore unavailable to you. Want to Upgrade?


To: Skeeter Bug who wrote (5210)5/28/1998 1:11:00 AM
From: Kirk ©  Read Replies (1) | Respond to of 42834
 
bm is often touted as a MAJOR player in this game. so much so that they borrow large amounts to buy back their stock and issue lots of options. if their stock ever goes down consistently and employees demand cash while paying interest on that debt, look out below...


The question is, do they issue more shares as options then they buy back? If no, then the net effect is more shares out of circulation thus higher eps thus higher share prices without paying dividends. If it is a wash, then it is still a matter of opinion if it is a good way to spend dollars on compensation.

regards
Kirk