{"title":"高管们如何从回购中赚取丰厚的费用(#2)——英伟达案例研究","authors":"M. Gumport","doi":"10.2139/ssrn.993964","DOIUrl":null,"url":null,"abstract":"Absolute analysis of accretion is a definitive measure of a buyback's contribution to shareholder wealth. In a case study of a world class corporation, NVIDIA spends $0.6 billion to repurchase 8.0% of its outstanding shares. The stock subsequently rises 90.1%. Absolute analysis shows ongoing NVIDIA shareholders benefit by $1.35 (3.8%) before tax considerations due to the direct effect of the buyback; managers benefit by up to $2.96 per option. Management option holders receive 30.9% of the buyback's stock price appreciation, akin to a \"1.7/20\" hedge fund fee structure for executive option holders. The small shareholder benefit, large gain for options, and sizable trading activity beg the questions: Should shareholder returns on buybacks be reported? Do benefits adequately compensate for 10b-18, 10b5-1, insider trading and option compensation governance liabilities?","PeriodicalId":437258,"journal":{"name":"Corporate Finance: Capital Structure & Payout Policies","volume":"1 1","pages":"0"},"PeriodicalIF":0.0000,"publicationDate":"2007-06-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":"{\"title\":\"How Execs Earn Sweet Fees on Buybacks (#2) - Nvidia Case Study\",\"authors\":\"M. Gumport\",\"doi\":\"10.2139/ssrn.993964\",\"DOIUrl\":null,\"url\":null,\"abstract\":\"Absolute analysis of accretion is a definitive measure of a buyback's contribution to shareholder wealth. In a case study of a world class corporation, NVIDIA spends $0.6 billion to repurchase 8.0% of its outstanding shares. The stock subsequently rises 90.1%. Absolute analysis shows ongoing NVIDIA shareholders benefit by $1.35 (3.8%) before tax considerations due to the direct effect of the buyback; managers benefit by up to $2.96 per option. Management option holders receive 30.9% of the buyback's stock price appreciation, akin to a \\\"1.7/20\\\" hedge fund fee structure for executive option holders. The small shareholder benefit, large gain for options, and sizable trading activity beg the questions: Should shareholder returns on buybacks be reported? Do benefits adequately compensate for 10b-18, 10b5-1, insider trading and option compensation governance liabilities?\",\"PeriodicalId\":437258,\"journal\":{\"name\":\"Corporate Finance: Capital Structure & Payout Policies\",\"volume\":\"1 1\",\"pages\":\"0\"},\"PeriodicalIF\":0.0000,\"publicationDate\":\"2007-06-14\",\"publicationTypes\":\"Journal Article\",\"fieldsOfStudy\":null,\"isOpenAccess\":false,\"openAccessPdf\":\"\",\"citationCount\":\"0\",\"resultStr\":null,\"platform\":\"Semanticscholar\",\"paperid\":null,\"PeriodicalName\":\"Corporate Finance: Capital Structure & Payout Policies\",\"FirstCategoryId\":\"1085\",\"ListUrlMain\":\"https://doi.org/10.2139/ssrn.993964\",\"RegionNum\":0,\"RegionCategory\":null,\"ArticlePicture\":[],\"TitleCN\":null,\"AbstractTextCN\":null,\"PMCID\":null,\"EPubDate\":\"\",\"PubModel\":\"\",\"JCR\":\"\",\"JCRName\":\"\",\"Score\":null,\"Total\":0}","platform":"Semanticscholar","paperid":null,"PeriodicalName":"Corporate Finance: Capital Structure & Payout Policies","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.2139/ssrn.993964","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}
How Execs Earn Sweet Fees on Buybacks (#2) - Nvidia Case Study
Absolute analysis of accretion is a definitive measure of a buyback's contribution to shareholder wealth. In a case study of a world class corporation, NVIDIA spends $0.6 billion to repurchase 8.0% of its outstanding shares. The stock subsequently rises 90.1%. Absolute analysis shows ongoing NVIDIA shareholders benefit by $1.35 (3.8%) before tax considerations due to the direct effect of the buyback; managers benefit by up to $2.96 per option. Management option holders receive 30.9% of the buyback's stock price appreciation, akin to a "1.7/20" hedge fund fee structure for executive option holders. The small shareholder benefit, large gain for options, and sizable trading activity beg the questions: Should shareholder returns on buybacks be reported? Do benefits adequately compensate for 10b-18, 10b5-1, insider trading and option compensation governance liabilities?
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