So last week Nu Skin filed a slew of Form 4's. These were mixed between option awards and restricted stock awards.
Now, if I were a savvy executive at a publicly traded company and I was recently awarded some stock or options, and I thought my shares were grossly undervalued, I'd pay my taxes on the awards via an in-kind withholding of shares.
Guess what seven Nu Skin executives did last Thursday? Guess no more. These awards were performance based awards with varying exercise prices/vesting dates.
I was just thinking that if I were up to get those awards I'd sure as hell want them granted at what I think the bottom of my company's stock price is. Instead of getting whacked on the tax up front, I'd hold them, allow them to appreciate and get my capital gains on too.
Likewise if I thought my company was going to get shellacked in the coming week because we were not going to be able to resolve the late filing of our 10-K, I'd probably wait to claim my shares because I'd much rather ride my award up than ride it down.
Also, if I were an executive at a publicly traded company and my colleagues on the audit committee didn't think we were going to be able to meet our expected March 18th deadline to file our 10-K, an expectation we gave on March 4th (9 days before our stock awards), we probably wouldn't be receiving stock awards to begin with nine days after we set that expectation.
It's hard to award options and restricted stock when your audit committee isn't confident the numbers are solid, particularly when two of the five audit committee members are also on the executive compensation committee.
If it turns out that my reading between the lines is correct I suspect we'll see Nu Skin meet their previously proposed filing date of March 18th (today) and we'll see continued appreciation in Nu Skin's stock price.
I also think that if Nu Skin's executives are able to successfully navigate their recent issues in China, they deserve whatever stock they were awarded.