What is diluted EPS? in finance what is the use of diluted
EPS?
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Answer Posted / sg reddy
earning per share indicaes that the prapotion of profit
allocated to an individual share.
Dilluted share meen increse the no of shares by convert
debenters ,Warrants, stock options, convertible preferred
shares. its simply called as Dillution effect.
To the reason of Dilluted shares the EPS is to be decrese
to compare the normal shares.
1. Its use as one of the anty takeover policy.
2. its not a present total shares but in the time redeme.
3. the diluted EPS will always be lower than the simple EPS.
4. A big difference in a company's EPS and diluted EPS can
indicate high potential dilution for the company's shares.
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