Diluted Earnings per Share (Diluted EPS)

Performance indicator used to gauge a company’s earnings per share, assuming that all stock options, options and conversion rights related to a convertible bond are exercised, which would result in an increase of the number of shares outstanding. Diluted EPS = (net income + interest expense on convertible bonds net of tax) / (weighted average number of shares outstanding during the year + weighted share options + shares from assumed conversion of convertible bonds).

    Go Back