EPS

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February 12, 2017 at 3:09 pm #372089
mmensah
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Hi Sir.

I understand why a rights issue will cause EPS to fall.. because we now have more shares for the same earnings… but why would this cause a reduction in dividend? Will the shareholders not get more dividend now they own more shares?

thanks
February 12, 2017 at 4:15 pm #372099
John Moffat
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The rights issue itself will not affect the total dividend that the company pays.

With more shares in issue it will mean therefore a lower dividend per share.
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