- Many US technology companies use stock compensation to help align workers' performance with shareholder interests.
- But stock-based compensation also creates accounting distortions that add risks to unwitting investors-especially as growth company valuations face increased scrutiny today.
- As market conditions rapidly change, we think investors in technology companies should dig deeper into employee expenses to ensure that a precarious compensation structure doesn't undermine return potential for an otherwise solid business.
For further details see:
Stock Compensation Adds Risks For Growth Companies