Hi, John.
Please help me with the following statement: "By issuing new shares at a high price, a company will reduce the number of shares it must issue to raise the amount of capital it wants. This will reduce the dilution of earnings for existing shareholders.
I dont understand the last sentence.
plz help
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The timing of new equity shares
10y ago#1The more shares that they issue then the lower the earnings per share (the profits divided by the number of shares).
(The wording of what you quoted is terrible - issuing more shares dilutes the earnings. Dilutes means reduces, so 'reducing the dilution' is nonsense :-) )
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