Dilutive effect

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 ?
This includes a residual dilutive effect on margins from the acquisition of Brasil Kirin, whose integration and results are very encouraging."
The committee noted that these warrants would be of modest value, which in turn would be partially offset by their dilutive effect on the stub equity held by the recipient.
The warrant transactions will have a dilutive effect to the extent that the market price per share of FXCM Inc's class A common stock exceeds the applicable strike price of the warrants on the applicable expiration dates of the warrants.
John Laing declared an interim dividend of 3.3p per share, equivalent to 21/1p if adjusted to take account of the dilutive effect of the rights issue.
The method used to determine the dilutive effect of a convertible security.
Thus, no new shares will be issued in connection with the plan and, therefore, the incentive plan will have no dilutive effect.
The acquisition is expected to have a slightly dilutive effect on BDa[euro](tm)s 2012 results but is not expected to affect its previously announced earnings forecast for the year, the buyer said.
News of the dilutive effect of the forthcoming placing helped push the shares down nearly 11 per cent yesterday, despite results in line with expectations.
The program would mitigate the dilutive effect on the ownership stakes of the company's shareholders, which might have resulted from the issuing of warrants to Walgreens Boots Alliance, Inc.
Closure of the deal is subject to approved due diligence and Vitrolife expects the transaction to have a slightly dilutive effect on its 2012 earnings per share because of acquisition-related costs and increased marketing activities.
Shares in NatWest, one of Britain's big four retail banks, fell 5.9 per cent to pounds 11.40 on Friday amid concerns about the dilutive effect of its planned offer of 210p per L&G share.
Also, this share delivery will be executed by using already existing shares and the plan and has no dilutive effect.