CEO Pay - Stock Dilution, Amazon etc (Patreon)

Corporate executives are awarding themselves lavish stock options packages, while also rewarding shareholders (many of whom are the same executives) with stock buybacks and dividends. This is being done at the expense of capital expenditures (CAPEX), which has led to a widening gap between CEO pay and the pay of average workers.

In 2022, the average CEO in the United States made $21.3 million, while the average worker made $51,168. This means that CEOs make 670 times more than the average worker.

The charts below show the trend of CEO pay over time, as well as the trend of CAPEX spending. As you can see, CEO pay has been increasing at a much faster rate than CAPEX spending. This is a concerning trend, as it suggests that companies are prioritizing short-term profits over long-term investment.

Shout out to EscapeVelocity

"share dilution disguised as performance bonus. Amazon are really bad at this for all level’s of employees. The share holder is paying the wages through dilution."

So I had a little dig into this

Amazon SBC - Stock Based Comp

Technology and content make up more than 50% of total SBC expense, which category overwhelmingly represents the AWS unit.

As SBC is not a cash expense the effect of it is mitigated in the cash flow calculation just like depreciation and amortization expense. So, if one looks at the cash flow margins of the company these don't include the effect of SBC. I believe the best way to include both the cash generation ability of a company and the dilution resulting from SBC into a valuation framework is to look at FCF on a per share basis.

Stunning Amazon Dilution last decade

Source BARD

Thread is here on Discourse

https://community.investanswers.io/t/ceo-pay/20267/5

Now you know why I am ALSO obsessed with TOKEN INFLATION aka Stock Dilution in Crypto