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With the stock now near $100, that gap translates into billions of embedded value.
Netflix has $7.4 billion in in-the-money stock options not reflected on its balance sheet.
KEY POINTS
- These options have an average exercise price of $36.07, while Netflix stock trades near $100.
- Including these options would increase Netflix's effective capital structure from $14.5 billion to $21.9 billion.
- Investors may begin treating stock-based compensation as a hard obligation rather than a soft expense.
COMPANIES
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