How it is worked out
The change in shares outstanding over a period, usually five fiscal years, from the company's filings. New shares come from stock-based pay, acquisitions paid in stock and share issues. Buybacks reduce them.
How to read it
- A company can buy back shares while the count stays flat, if stock-based pay issues as many as it buys. That is why the analysis sets the two side by side.
- Earnings per share can grow slower than earnings when the count rises, and faster when it falls.
Example
100 million shares becoming 110 million in five years: 10% dilution, and an existing holder owns about 91% of the stake they had.