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Winners and Losers in the Options Race
It's bonus season on Wall Street, and a fair number of masters of the universe are in for disappointments. A drop in stocks and a drought in credit markets are making for tough times.
If schadenfreude is any consolation, others are suffering, too. Stock options at more than one third of the largest 500 U.S. corporations are underwater, the executive compensation firm Steven Hall & Partners reckons.
Airlines, automakers, homebuilders, drug companies, communications firms, and retailers join financial services among the hardest-hit industries.
Beazer Homes USA, for example, is hurting the most, the compensation consultant firm figures. Beazer's stock price is more than 80 percent below the average exercise price of the 2,135,573 stock options currently outstanding. Tenet Healthcare is almost as bad, with an average exercise price that is very nearly 80 percent below the current stock price.
Not all news is bad. There are some winners, too. Stock options at energy companies, utilities, iron and steel makers, chemicals producers, consumer staples suppliers and military contractors are still in the black, on average — sometimes deeply in the black.
Following are Steven Hall & Partners' lists of the winners and losers in the stock options race.
by Mark Stein
Ten Best Performers
| Company | Industry | Percent in the Money |
|---|---|---|
| Peabody Energy | Coal | 560.3% |
| Allegheny Technologies | Iron/Steel | 557.5% |
| GameStop | Retail | 481.5% |
| Mosaic | Chemicals | 446.4% |
| AK Steel Holding | Iron/Steel | 446.3% |
| Chesapeake Energy | Oil&Gas | 420.1% |
| Monsanto | Chemicals | 372.4% |
| Reynolds American | Agriculture | 352.7% |
| Cummins | Machinery-Diversified | 351.2% |
| Amazon.com | Internet | 327.8% |
Ten Worst Performers
| Company | Industry | Percent Underwater |
|---|---|---|
| Beazer Homes USA | Home Builders | -82.3% |
| Tenet Healthcare | Healthcare Services | -79.1% |
| Unisys | Computers | -75.6% |
| Charter Communications | Media | -74.3% |
| Countrywide Financial | Financial Services | -73.9% |
| Circuit City Stores | Retail | -72.8% |
| Sanmina-SCI | Electronics | -72.3% |
| Blockbuster | Retail | -67.4% |
| Micron Technology | Semiconductors | -66.6% |
| Ford Motor | Auto Manufacturer | -65.9% |
