Diluted Earnings Per Share Calculator

Formula

To calculate the Diluted Earnings Per Share ($DEPS$):

\[ DEPS = \frac{NI}{AS + OI} \]

Where:

$DEPS$ is the diluted earnings per share
$NI$ is the net income ($)
$AS$ is the average shares
$OI$ is other convertible instruments

What is Diluted Earnings Per Share?

Diluted earnings per share, also known as diluted EPS, is a financial term used to analyze earnings per share when taking into account other convertible instruments that could affect the overall EPS. This allows investors to make more accurate predictions of the future EPS of a company.

Example Calculation 1

Let's assume the following values:

Net Income ($NI$) = $1,000,000
Average Shares ($AS$) = 500,000
Other Convertible Instruments ($OI$) = 50,000

Using the formula:

\[ DEPS = \frac{1,000,000}{500,000 + 50,000} = \frac{1,000,000}{550,000} \approx 1.82 \]

The Diluted Earnings Per Share is $1.82.

Example Calculation 2

Let's assume the following values:

Net Income ($NI$) = $2,000,000
Average Shares ($AS$) = 1,000,000
Other Convertible Instruments ($OI$) = 200,000

Using the formula:

\[ DEPS = \frac{2,000,000}{1,000,000 + 200,000} = \frac{2,000,000}{1,200,000} \approx 1.67 \]

The Diluted Earnings Per Share is $1.67.