4 ms·

Some of the companies whose stock price has been affected the most are making up for the loss by giving more stock. I’d expect Facebook to do the same to retain

by asd88 5y ago

Some of the companies whose stock price has been affected the most are making up for the loss by giving more stock. I’d expect Facebook to do the same to retain their talent if the stock drops significantly.

PascLeRasc 5y ago
Off topic: when companies give out stock like this, where is it coming from? Are they printing shares out of thin air or buying back shares to give to employees?
- asd88 5y ago
  They issue more stock and the existing investors’ ownership is diluted.
- ts4z 5y ago
  Depends on the company. Dilution is normal, but some companies are buying back stock to use up excess cash; in this case, they can issue those shares to employees.
- colinmhayes 5y ago
  Thin air, although most tech companies are buying back more shares than they give out.
- paxys 5y ago
  Cash-rich companies (especially the large tech ones) do share buybacks very regularly. Facebook bought back $14.4B worth of shares in Q3 2021, and announced a further $50B worth of buybacks in the coming quarters (https://www.yahoo.com/now/facebook-warns-fourth-quarter-headwinds-204010756.html https://www.yahoo.com/now/facebook-warns-fourth-quarter-head...). Diluting existing shares to give out employee bonuses are comparatively a drop in the bucket.
  - adam_arthur 5y ago
    Not true. Facebook's share count has been roughly neutral, slightly negative. The buybacks get canceled out by employee equity issuances. Look at Apple's share count over time if you want to see a buyback not overpowered/diluted by employee equity. https://www.macrotrends.net/stocks/charts/FB/meta-platforms/shares-outstanding https://www.macrotrends.net/stocks/charts/FB/meta-platforms/... https://www.macrotrends.net/stocks/charts/aapl/apple/shares-outstanding https://www.macrotrends.net/stocks/charts/aapl/apple/shares-... It's possible these new rounds of buybacks are far in excess of employee comp though, just saying historically speaking.

by asd88 5y ago

PascLeRasc 5y ago

Off topic: when companies give out stock like this, where is it coming from? Are they printing shares out of thin air or buying back shares to give to employees?

asd88 5y ago
They issue more stock and the existing investors’ ownership is diluted.
ts4z 5y ago
Depends on the company. Dilution is normal, but some companies are buying back stock to use up excess cash; in this case, they can issue those shares to employees.
colinmhayes 5y ago
Thin air, although most tech companies are buying back more shares than they give out.
paxys 5y ago
Cash-rich companies (especially the large tech ones) do share buybacks very regularly. Facebook bought back $14.4B worth of shares in Q3 2021, and announced a further $50B worth of buybacks in the coming quarters (https://www.yahoo.com/now/facebook-warns-fourth-quarter-headwinds-204010756.html https://www.yahoo.com/now/facebook-warns-fourth-quarter-head...). Diluting existing shares to give out employee bonuses are comparatively a drop in the bucket.
- adam_arthur 5y ago
  Not true. Facebook's share count has been roughly neutral, slightly negative. The buybacks get canceled out by employee equity issuances. Look at Apple's share count over time if you want to see a buyback not overpowered/diluted by employee equity. https://www.macrotrends.net/stocks/charts/FB/meta-platforms/shares-outstanding https://www.macrotrends.net/stocks/charts/FB/meta-platforms/... https://www.macrotrends.net/stocks/charts/aapl/apple/shares-outstanding https://www.macrotrends.net/stocks/charts/aapl/apple/shares-... It's possible these new rounds of buybacks are far in excess of employee comp though, just saying historically speaking.