Restricted Stock Grants Leading Options at Large Cos.

By Mary Hughes

Oct. 8 — Equity compensation grants made by large U.S. companies in traditional and technology industries favored restricted stock awards in 2013, continuing a trend away from stock options, according to a study of publicly traded companies' stock compensation disclosures.

The “Stock Compensation 2014 Assumption and Disclosure Study,” released Oct. 7 by PricewaterhouseCoopers LLP, analyzed 2013 Form 10-K filings of companies with a Dec. 31 fiscal year-end and disclosing stock compensation expense. Companies included in the study are the top 100 companies in the Standard & Poor's 500 index and the top 100 technology companies on the Nasdaq technology, biotechnology and pharmaceutical industry lists.

The study found that, among the large companies, equity award grant types were split 51 percent restricted stock to 49 percent stock options. Among large technology companies, the split was even more pronounced, at 59 percent restricted stock and 41 percent stock options.

The value of restricted stock awards far exceeds the value of stock options granted in 2013 in both large companies and large technology companies, according to the study. In terms of value, among the large companies, in 2009 the ratio of stock to option awards was about 2.5-to-1, growing to almost 6-to-1 in 2013. On the technology side, the ratio grew from about 3-to-2 in 2009 to almost 6-to-1 in 2013, the study said.

To contact the reporter on this story: Mary Hughes in Washington at mhughes@bna.com

To contact the editor responsible for this story: Phil Kushin at pkushin@bna.com

The study is online at http://www.pwc.com/en_US/us/hr-management/publications/assets/pwc-stock-compensation-september-2014.pdf.