What does Increasing in fully Diluted EPS of company mean?

Question

What could be potential reason behind increasing fully diluted EPS?

Answer 1

I don't understand it either. Why would you want to increase fully diluted EPS when that is going to mean that the actual EPS would go down likely causing the stock price to drop. Why someone would do that, I don't know.

As far as how to do it, they would do it by increasing convertible securities like warrants and stock options, and preferred shares of stock. Why they would do this, is a mystery.

For more information on Diluted EPS, check out the link below.

Answer 2

increasing fully diluted EPS is teh same as an increase in regular EPS.  the only difference is that diluted EPS accounts for your number of shares outstanding after considering the amount of warrants outstanding and their expected exercise into common shares.   so your number of diluted shares is typically higher than your number of common shares outstanding.

you used to use the treasury method of accounting for calculating diluted EPS.  not sure if its still that way.

earnings could increase for a number of reasons.