[Am-info] Stock options and MSFT earnings

[John J. Urbaniak]

More on MSFT options:

 http://www.nceo.org/library/optionreport.html

Public Companies with Broad-Based Stock Options: Corporate Performance
     from 1992-1997

     Joseph Blasi, Douglas Kruse, James Sesil
     Rutgers University
     Maya Kroumova
     New York Institute of Technology

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"...(Business Week 1998) After the  U.S. Government formally proposed the
breakup of Microsoft, the company took a step similar to repricing by
rescuing all of its employees whose options  were now underwater. Microsoft
issued employees 70 million new stock options at $66.625 each at an
indicated value of $1.6 billion. (Morgensen 2000)

...For  years Miscosoft stock climbed on the strength of enviable profits.
One reason for its profitability was its reliance on stock options, which
cut costs while keeping workers happy and rich. The rising stock also meant
that few shareholders groused about the dilution to earnings presented by
1.1 billion shares Microsoft says it has issued since 1990, net of buybacks,
under stock option and purchase plans."

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Hmmm, they issued new options at $66.625 in 1998?.  These are now under
water also with MSFT at abour $46.00..

John