Employee Stock Options: Exercise Decisions By Top Executives

Article Abstract:

Keywords: Stock Option, Black-Scholes Value, Option Rights This study investigates the timing of stock option exercise decisions made by top executives at 65 large companies. Executives in the sample typically exercise when the intrinsic value of the option is approximately equal to its Black-Scholes value. Subsequent stock price performance is significantly poorer for exercise decisions that are made when the intrinsic value is much lower than the Black-Scholes value of the remaining option rights. This suggests that interpretation of private information conveyed by exercise decisions should be conditioned on the circumstances of the exercise.

Finance

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Dividend policy issues in regulated and unregulated firms: a managerial perspective

Article Abstract:

The level of dividends is usually determined by expected earnings, according to public utilities managers surveyed. Other explanations of dividend policy include signaling, perceived risk, tax-related issues, and continuity with past dividends.

Electric, Gas & Water Utilities, Utilities, ELECTRIC, GAS, AND SANITARY SERVICES, Statistical Data Included, Dividends, Surveys, Securities, Energy industries, Executives, Energy industry, Public utilities

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