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To "ignorant" shareholders, there's no difference between stock and cash compensation.

• danieltillett 9y ago
  In the long run this is true, but in the short run ignorant shareholders overlook the dilution and just focus on the reported cash profit. I do say I find it interesting that people even think that if you are going to be paid $x in total compensation it is better to be paid $x-y cash and $y in stock. I guess this sort of magical thinking is why companies do it.
  • s17n 9y ago
    That's what I'm saying, the "reported cash profit" includes stock-based compensation as an expense exactly like regular salaries. You don't even have to know what dilution means.