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Strategies & Market Trends : Gorilla and King Portfolio Candidates

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To: DownSouth who wrote (7221)9/29/1999 12:53:00 PM
From: Zirdu  Read Replies (1) of 54805
 
The number of authorized shares is not too relevant to anything, other than it sets the limit on what the number of shares might be issued in the future. (Until such time as more shares are authorized) All that counts for purposes of dilution is the number of shares issued and outstanding, and the number of employee stock options in the money. This total is the "diluted shares outstanding" and is used to figure all per share figures, such as EPS, Sales per share, etc.

Before deciding on whether there will be any dilution, first we have to hear what shares will be issued, and for what. If issued in connection with a stock split, however structured, there is of course no dilution. If issued to buy another company, or to issue employee options, or for a secondary offering, of course there can be dilution.
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