Fully Diluted Shares from a 10-Q
I'm currently working on an input page for company in the first comp analysis I have ever done and I am having trouble calculating fully diluted shares outstanding.
Looking at their most recent 10-q, I am wondering where I would find the amounts for the in-the-money options and warrants.
Would I take this amount from the Stock Options exercised or from the Common Stock Repurchase Program section that outlines the average price paid and amount of shares repurchased?
Thank you in advance for any help.
Usually, in 10-Qs and 10-Ks, somewhere in your Statement of comprehensive income or Consolidated Statement of Income, you have the EPS calculation (which is done on a diluted basis) and there should be a line similar to "number of shares used for the diluted EPS". Don't know if you can use that or you've actually been aksed to re-calculate the FDSO yourself
If you need to calc yourself there are four things you need: 1) basic shares outstanding from the cover of the Q 2) restricted shares (sometimes its in there as "performance shares" or restricted stock units or RSUs) as well - this will be in the footnotes 3) options outstanding (should be in a table in the footnotes - be sure to use the outstanding number not the vested number) and weighted average strike price 4) warrants outstanding (should be in a table in the footnotes) and weighted average strike price.
In order to calc diluted shares you would add restricted shares to the basic shares number, and then use Treasury stock method to get the number of equivalent shares you could repurchase based on in the money options / warrants
http://www.investopedia.com/terms/t/treasurystockmethod.asp
So your final calc will be basic shares + restricted stock units + assumed repurchased shares based on ITM option exercise + assumed repurchased shares based on ITM warrant exercise
You can also use the diluted number they used in their EPS calc, but the above method is a bit more CYA and at least in my group what someone would be expecting
Hi,
I also have the difficulty in calculating Fully Diluted Shares Outstanding. I would like to ask if you know where I could find the information below from the 10K. Thank you so much!!!
Plus: Shares from In-the-Money Options Less: Shares Repurchased Net New Shares from Options Plus: Shares from Convertible Securities Plus: Shares from RSU's Dilution
Fully Diluted Shares Outstanding
Your issue may be that sometimes 10-q's are a little sparse on useful info, especially with regard to options, warrants, and restricted stock. In that case, you'll have to use the 10-k, which will be more dated, but at least it will have the data you need.
Thanks CHitizen - I forgot about that.
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