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iphone 7 plus case Sign in / Join NowSummaryFinancing the future the importance of factoring in dilution in financial projections and valuations.Which companies are most likely to dilute shareholders and best practices for factoring dilution into your analysis.Two real world examples from an industry expert.By John Leonard, CFA”It takes money to make money.”While the above quote falls into the category of ”a nickel’s worth of free advice” (only because it is so obvious), its application to financial analysis is worth significantly more than 0.05 USD.We’re here today to talk about dilution usually a company’s decision to raise equity capital at the expense of existing shareholders. When a company sells stock to raise cash, the newly issued shares dilute the ownership interest of those who have already bought in.While dilution is not limited to the biotech industry, it is where it occurs most frequently (due to the lack of current revenue and high R expenses incurred as companies develop and work to get their drugs approved). So the discussion will focus on biotech here, but be aware that similar practices for analyzing shareholder dilution can be broadly applied.Not all pre revenue biotech companies dilute shareholders. iphone 7 plus case

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