Dilutive effect

(redirected from Dilutive Effects)

Dilutive effect

Result of a transaction that decreases earnings per common share (EPS).

Dilutive Effect

The result of an increase in the number of shares, usually through a new issue. That is, a company may issue more shares to shareholders and other investors, which raises the number of shares outstanding. This decreases the company's earnings per share, which, in turn, can decrease the stock price. See also: Anti-dilution provision.
References in periodicals archive ?
For calculating the dilutive effects of options and warrants, the FASB would retain Opinion no.