Dilutive Acquisition

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Dictionary Says

Definition of 'Dilutive Acquisition'

A takeover transaction that will decrease the acquirer's earnings per share (EPS) if additional shares are issued to pay for the acquisition. Dilutive acquisitions decrease shareholder value and should thus be avoided, unless the strategic value of the acquisition is expected to cause a sufficient increase in EPS in later years. An acquisition is only a good deal if the acquirer can derive more value from the acquisition than it pays out.
Investopedia Says

Investopedia explains 'Dilutive Acquisition'

The easiest method of determining whether an acquisition deal is accretive or dilutive is to compare the price to earnings (P/E) ratios of the firms involved. If the target firm's P/E ratio is higher than the acquirer's P/E, then the transaction is dilutive.
Search results for

'Dilutive Acquisition'

  • Analyzing An Acquisition Announcement

    http://www.investopedia.com/articles/stocks/08/acquisition-announcement.asp
    ... Read on for some suggestions for analyzing acquisition deals. ... fund the acquired
    company's growth with no problem, or will a potentially dilutive stock offering ...

  • The Wonderful World Of Mergers

    http://www.investopedia.com/articles/stocks/09/merger-acquisitions-types.asp
    ... Reverse merger A reverse merger - also called a reverse acquisition or reverse takeover ...
    Dilutive merger The opposite of an accretive merger is a dilutive one ...

  • The Dangers Of Share Dilution

    http://www.investopedia.com/articles/stocks/11/dangers-of-stock-dilution.asp
    ... Learn more in What is dilutive stock?) Meanwhile ... Instead of paying for an acquisition
    with shares, new shares might be offered to shareholders of the firm being ...

  • Accretion / Dilution Analysis: A Merger Mystery

    http://www.investopedia.com/articles/fundamental-analysis/09/accretion-dilution-analysis-mergers.asp
    ... Many on Wall Street typically frown at dilutive transactions. ... (Take a look at our
    article Biggest Merger and Acquisition Disasters for some examples of ...

  • CFA Level 1 Study Guide - Financial Statements - Cash Flow ...

    http://www.investopedia.com/exam-guide/cfa-level-1/financial-statements/cash-flow-statement-basics.asp
    ... 7.10 Uses and Limitations of Financial Ratios; 7.11 Basic Earnings Per Share;
    7.12 Dilutive Effect of Splits and Dividends; 7.13 Dilutive ...

  • CFA Level 1 Study Guide - Assets - Depreciation Accounting ...

    http://www.investopedia.com/exam-guide/cfa-level-1/assets/depreciation-accounting.asp
    ... 7.10 Uses and Limitations of Financial Ratios; 7.11 Basic Earnings Per Share;
    7.12 Dilutive Effect of Splits and Dividends; 7.13 Dilutive ...

  • CFA Level 1 Study Guide - Assets - Capitalizing Intangible Assets ...

    http://www.investopedia.com/exam-guide/cfa-level-1/assets/capitalizing-intangible-assets.asp
    ... 7.10 Uses and Limitations of Financial Ratios; 7.11 Basic Earnings Per Share;
    7.12 Dilutive Effect of Splits and Dividends; 7.13 Dilutive ...

  • CFA Level 1 Study Guide - Assets - Accelerated Depreciation ...

    http://www.investopedia.com/exam-guide/cfa-level-1/assets/accelerated-depreciation.asp
    ... 7.10 Uses and Limitations of Financial Ratios; 7.11 Basic Earnings Per Share;
    7.12 Dilutive Effect of Splits and Dividends; 7.13 Dilutive ...

  • CFA Level 1 Study Guide - Ethics and Standards - Standard II-A ...

    http://www.investopedia.com/exam-guide/cfa-level-1/ethics-standards/standard-nonpublic-information.asp
    ... 7.10 Uses and Limitations of Financial Ratios; 7.11 Basic Earnings Per Share;
    7.12 Dilutive Effect of Splits and Dividends; 7.13 Dilutive ...

  • CFA Level 1 Study Guide - Assets - Asset Impairment | Investopedia

    http://www.investopedia.com/exam-guide/cfa-level-1/assets/asset-impairment.asp
    ... 7.10 Uses and Limitations of Financial Ratios; 7.11 Basic Earnings Per Share;
    7.12 Dilutive Effect of Splits and Dividends; 7.13 Dilutive ...

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