Long-Term Incentive (LTI) Value Calculator
Estimate the projected value of your Long-Term Incentive (LTI) awards — including Restricted Stock Units (RSUs), Stock Options, and Performance Shares — based on grant details, vesting schedules, and assumed stock price growth.
Grant Details
Vesting Schedule
Growth & Tax Assumptions
Formulas Used
RSU Gross Value at Vesting (Year t):
Valuet = Sharest × P0 × (1 + g)t
Stock Option Intrinsic Value at Vesting (Year t):
Valuet = Sharest × max(0, P0 × (1 + g)t − Strike)
Performance Share Value:
Valuet = Sharest × (Multiplier / 100) × P0 × (1 + g)t
After-Tax Value:
After-Tax Valuet = Valuet × (1 − Tax Rate)
Net Present Value (NPV) of After-Tax Cash Flows:
NPV = Σ [ After-Tax Valuet / (1 + r)t ]
Where: P0 = current stock price, g = annual growth rate, r = discount rate, t = year of vesting
Assumptions & References
- RSU values are taxed as ordinary income at vesting; stock options may qualify for capital gains treatment depending on holding period and option type (ISO vs. NSO).
- Performance share multipliers typically range from 0% (threshold not met) to 200%–300% (maximum payout); 100% represents target performance.
- Stock price growth is assumed to be constant annually (geometric); actual returns will vary.
- Graded vesting distributes shares equally across each year after the cliff period.
- Back-loaded vesting uses a 10/20/30/40 split across 4 years (common in some executive plans).
- NPV discounts future after-tax cash flows to today's dollars using the specified hurdle/discount rate.
- This calculator does not account for forfeitures, blackout periods, or 409A valuations.
- References: FASB ASC 718 (Stock Compensation), IRS Publication 525 (Taxable and Nontaxable Income), CFA Institute — Equity Compensation Valuation.