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Bristol-Myers Squibb Company Message Board

  • kiera-r kiera-r Jan 22, 1998 5:55 PM Flag

    FYI: Basic vs Diluted Earnings

    I've seen a lot of confusion about this on the threads and in the press about diluted vs basic earnings--for example in stories today that erroniously said BMY did not meet the consensus.

    New accounting rules have been introduced this year that require companies to report earnings per share in two ways: ``basic'' and ``diluted''.

    So it is worth looking at this article which explains the difference between basic and diluted earnings.

    target=new >

    The key concept is
    Diluted results take into account conversions into stock of options, warrants, debentures and other instruments.

    The Basic Earnings figure is income available to common shareholders divided by weighted average shares outstanding.

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