Company selected: Pepsi
Option contracts: employee option contracts
Value of the option contract in the Annual Statements: 185 million. An
employee stock option is a contract that gives employees the right to buy a
specific number of shares of company stock at a specified price called the
strike price, within a particular time frame known as the exercise window
(Deane, 2021).
If I were to retire from this company, I would sell these stocks and invest in
less riskier options. I would ideally have income from three primary
sources: Social Security, your retirement plan, and savings (Barringer,
2022). Since bonds tend to fluctuate less in price than stocks and dividends
tend to rise over time, together they make a sensible portfolio for people
who want to receive a rising income (from the stocks) and who want to
reduce risk. This is because the bonds generally fluctuate in price very little
over their term (Barringer, 2022).
References
Barringer, J. (2022, May 15). Retirement planning with employee stock
compensation. Executive Wealth Planning. Retrieved January 5, 2023, from
https://www.executivewealthplanning.com/blog/retirement-planning-with-
stock-compensation
Deane, S. (2021, March 17). How do employee stock options work?
Morningstar, Inc. Retrieved January 5, 2023, from
https://www.morningstar.com/articles/1029029/how-do-employee-stock-
options-work
Edgar: Company filings. U.S. Securities and Exchange Commission .
(2022, July 22). Retrieved January 5, 2023, from
https://www.sec.gov/edgar/searchedgar/companysearch
PepsiCo Annual Report 2021. (2022). Retrieved January 6, 2023, from
https://www.pepsico.com/docs/default-source/annual-reports/2021-annual-
report.pdf?sfvrsn&
• image_59342696021672980760432.png
(16.41 KB)
• image_49640872331672980760455.png
(153.6 KB)
