Stock Price And Effect On Employees

[IntelligentObserver]

With the current drop in stock price, how much, on average, has each employee lost on their stock options?

Is the company planning on giving you more stock to make up for the shortfall?

Seems to me that each employee stands to lose ALOT.

 

[bigbusdrvr]

With the current drop in stock price, how much, on average, has each employee lost on their stock options?

Is the company planning on giving you more stock to make up for the shortfall?

Seems to me that each employee stands to lose ALOT.

I read wher a senior pilot at JBLU made 250,000+ last yaer, I would suspect thru stock sales. Congrats!!

 

[IntelligentObserver]

With the current drop in stock price, how much, on average, has each employee lost on their stock options?

Is the company planning on giving you more stock to make up for the shortfall?

Seems to me that each employee stands to lose ALOT.

I read wher a senior pilot at JBLU made 250,000+ last yaer, I would suspect thru stock sales. Congrats!!

So, where does that leave those pilots who have held on their stock, now diminished in value?

It seems the company, if it were interested in keeping the employees happy, as I keep hearing, will issue more stock to make up for the diminished value of those shares they already have.

 

[Blue Dude]

Stock options have a long term investing horizon. The stock is down 40% in the past 4 months. So what. It was up 250+% in the prior 18 months. But again, so what. If the stock is still stagnant in 10 years, then I'll begin to worry. Stock options are only worth something when you sell the underlying shares, and not a single JetBlue pilot is even 50% vested yet. Be patient. If, much later, it looked like stock options were going to expire underwater, I would expect them to be repriced. More options might be granted at some future date, but it won't be because of short term price fluctuations.

And BTW, the handful of pilots who made $250k+ weren't doing it on stock sales. They were check airmen who worked their tails off in the sim, loading up on lots of time-and-a-half. No FAR mins in the sim so they were paid for 140+ hrs per month. There are many more dedicated sim instructors now so that doen't happen so much anymore.

 

[IntelligentObserver]

But when part of your compensation comes in the form of stock, shouldn't adjustments be made when the stock tanks, as it just did?

 

[v1rotate]

But when part of your compensation comes in the form of stock, shouldn't adjustments be made when the stock tanks, as it just did?

Stock options are NOT compensation. Never were and never will be. Stock options are an added perk...an incentive if you will.

V1

 

[bigbusdrvr]

Stock options have a long term investing horizon. The stock is down 40% in the past 4 months. So what. It was up 250+% in the prior 18 months. But again, so what. If the stock is still stagnant in 10 years, then I'll begin to worry. Stock options are only worth something when you sell the underlying shares, and not a single JetBlue pilot is even 50% vested yet. Be patient. If, much later, it looked like stock options were going to expire underwater, I would expect them to be repriced. More options might be granted at some future date, but it won't be because of short term price fluctuations.

And BTW, the handful of pilots who made $250k+ weren't doing it on stock sales. They were check airmen who worked their tails off in the sim, loading up on lots of time-and-a-half. No FAR mins in the sim so they were paid for 140+ hrs per month. There are many more dedicated sim instructors now so that doen't happen so much anymore.

I thought JBLU instructors were all f/o's?? At 140 hours of sim time that still must be a nice hourly rate!! I hate to pry but does anybody have the JBLU pay rates??

You should be proud! These don't sound like your dad's LCC............

 

[Ch. 12]

Stock options are NOT compensation. Never were and never will be. Stock options are an added perk...an incentive if you will.

V1

Agreed. Stock options are a long-term investment. They are a way of profit sharing. The idea is that if the employees perform well and drive stock prices up, there will be a payoff down the road. They are not compensation...employees are being paid through stock.

Startups such as WN and JB hvae used options to allow employees to benefit from the risk involved. WN options are paying off quite nicely...30 years after they began. But WN was not a major success immediately and it took years for the options to be as valuable as they are today.

I would not jump ship with my JBLU options (if I had any) nor would I request anything else from the company. And there is no way for the company to "offer more" stock. As the name implies, options are an option to purchase stock at a reduced rate. They are always valuable as long as the company doesn't liquidate. I don't see that in the near future of JBLU.

 

[Winglet]

JB is doing well, but may not in the future. Do not tie up your income, all retirement, or any large part of your personal savings in one company. That's just dumb. Lots of UAL people have lost a lot of money on the ESOP nonsense.

The airline industry and fortunes of individual companies can turn on dimes, so don't trust them.

 

[Ch. 12]

I agree that employees shouldn't tie up everything in one company...especially an airline. I only think that options are good if you are already a player in the stock market and you are diversified. If that is the case, then it is hard to pass up stocks at an option price unless a rapid demise of the company is imminent. JBLU may not be around forever, but a longterm investment doesn't have to mean 20 years. For the next handful of years, JBLU will definitely be around, though.

 

[Farley]

Stock options have a vesting schedule (as most of you know) so while some may want out of Jetblue stock, they can't get out yet. Also, the options are granted to you, so unless you exercise them, they don't cost you a penny. So why should the company "make up" the lost value on something that is given to you? Most of us are in it for the long term, so the daily/monthly fluctuations are not a concern. Even if the stock ends up being worthless, most of us will be prepared for retirement.