Diluted EPS(earnings per share)

We get Diluted EPS when Net Income is divided by Diluted Shares of the same company.

The diluted share is the number of shares outstanding in the market plus any shares that would be considered outstanding today if all option and warrant holders that are in-the-money decided to exercise on their securities. The diluted share count is best thought of as a “What if?” scenario. If all the option and warrant holders who could exercise would, how many shares would be outstanding now?

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