Replies to post #15736 on Momenta Pharmaceuticals, Inc. (MNTA)

[DewDiligence]

MNTA diluted share count for valuation purposes:

As of 1/27/17, MNTA had 71.3M basic shares outstanding (https://www.sec.gov/Archives/edgar/data/1235010/000110465917006308/a17-3468_110qa.htm page-1, bottom).

AS of 12/31/16, MNTA had 7.0M options outstanding (some not yet exercisable) at an average exercise price of $13.68 (https://www.sec.gov/Archives/edgar/data/1235010/000123501017000003/mnta1231201610k.htm#s8E0293C0D7E45268AB8DFF4D3C3CC319 page 92).

To be conservative, I include all 7.0 of the above options in my tally even some of them are not yet exercisable and some of them are currently out-of-the-money.

Therefore, my diluted share count for valuation purposes is 78.3M.

(I do not use the “treasury method” of calculating the diluted share count, which reduces the share count according to the price at which options are exercisable, because the straightforward method of counting all options without adjustment gives a more realistic view of the number of shares that would need to be cashed out in a buyout at a typical premium.)