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Diluted Earnings Per Share - Diluted EPS

Diluted Earnings Per Share - Diluted EPS Definition

Diluted Earnings Per Share - Diluted EPS is a performance metric indicating the quality of a company's earnings per share (EPS) if all convertible securities were exercised. Earnings per share is calculated by dividing profit by the number of shares.

When calculating Diluted EPS, the number of shares outstanding is increased by the number of convertible securities like convertible preferred shares, convertible debentures, stock options and warrants. The Diluted EPS is usually lower than the simple EPS, as the same profit is divided by a higher number of shares.





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