NewAge Inc (fka NBEVQ) (NBEVQ)

[treit2002]

"Dilution is NEVER accretive."

OK. Fair enough, if referring to share count only. But the point is whether or not the share dilution is positive for shareholders or not. For instance, most all tech companies dilute shareholder interest in taking venture capital money. But the point is valuation. UBER shareholders, or any company's, are quite happy to own 1/10th the % of UBER if the valuation is 20x.

In NBEV's case, one upstanding thing Mr. Willis has done is take accountability for the financing fiasco. Had he issued shares a year ago at approximately today's price, the whole thing could have been avoided, and the company would be far better off.

When you harp on "dilution," and as in your example, assume that new capital lays dormant or is misused, it simply appears to pump a short book, imo. Because the real point is the effect on EPS, once funds are deployed. Irrelevantly, the immediate impact in this case is accretive, because the company loses money.

Of course, we don't know the longer term impact on EPS of a capital raise. But if NBEV wants to pursue a national footprint with new products, it will need more capital, plain and simple.

If it uses the new capital and fails in its efforts; yes, it would be dilutive to EPS and obviously hurt the share price. If it succeeds, the opposite.