India
Yesterday
284
Heard congress distributing wealth
Tech Industry
Yesterday
1112
I haven’t done shit today!
Tech Industry
2d
42603
Worried that our top performer is an attrition risk. How do managers handle this?
Tech Industry
Yesterday
3170
Avoid teams with only Chinese or Indians especially with a Chinese/Indian manager
Tech Industry
Yesterday
688
Goodbye USA tech jobs
Say a company gives you 1 RSU worth 100$. How much does it actually cost them? I guess a lot less than if you received 100$ cash but how much? What's the theory behind shares?
Why do you think it's a lot less? Of course there's a vesting schedule so you need to take time value of money into account, but other than that I can't think of anything. RSUs are a way to tie your incentive to company performance. They are not a cost saving mechanism.
You misread my question. I'm not asking if it is worth less to me but to the company. If they give me 100$ , it comes from a bank account. The company has to earn that money and they could buy a sandwich with it. If they give me a RSU, it's like printed money. They don't have to "directly" have earned it. Say a company makes 0 profit but is highly valued.
RSUs are new shares and don’t cost the company anything as they don’t have to actually buy them. When/if your RSU vests, shareholders lose $100 (or whatever the market price is on that day) as their shares are diluted.
This. It's dilution of existing shares. Be careful of companies with large RSU commitments if you are a shareholder; as an employee, sell shares on the day of vest and diversity your holdings.
How to find out whether a company has large RSU commitments?
It depends if they buy back shares from the market or not
There are tax implications (benefits) for company’s issuing RSUs as well
Although they don't cost the company anything in cash they do have to be expensed at fair market value. So, they also reduce profitability.
But Wall Street has proven not to care about standard ebitda accounting and prefer metrics like adjusted CFO, etc where RSUs don’t impact valuation. So it’s not clear that RSUs have a material impact on a firms stock price (theoretically they should I agree though)
Company’s do stock buy backs all the time especially when stock price is low. Also if it is just IPOed company, they have pre ipo shares which probably had. A lot lower value.
Not one satisfactory answer. No one here knows shit.
Non cash expense
You’re definitely a LC hire
A what?