Intel Corp (INTC)

[smoothh20]

Dew: For tech companies which are heavy option grantors, it is more common for them to buy back shares to offset option exercises when they realize that option exercises are apt to cause non-trivial expansion of the share base during the current fiscal year –i.e. when the stock price is comparatively high.

And that's where your're wrong. This has been an ongoing program at Intel, sinceever.

If you want to call the difference between today's exercise price and today's stock price an expense, then you are causing an expense due to the stock's appreciation, essentially penalizing the company for it's performance. Using the same logic, the unexercised options should be a credit. The problem rests with the requirement to account for all costs and expenses with the current year when in fact the real costs are not within the current year. As Andy says, "there is no good way to evaluate the costs of options".

In fact, Intel cannot trade its stock on the open market. It holds the stock in reserve for the option programs. When it is given to the employee (for the amount it cost),

*it's a push*.

Smooth