Replies to post #54830 on Elite Pharmaceuticals Inc (ELTP)

[evenkeel]

The more shares outstanding the higher the market cap given the same share price.

Say 350 million shares at 7 cents = $24.7 million market cap

Then 550 million shares at 7 cents = $38.5 million market cap

So the more shares that go out the higher the market cap becomes assuming the same share price.

[IB_]

"Correct me if I'm wrong but dilution would effect the number of outstanding shares not market cap??"

Dilution may effect market cap "IF" it causes the share price to fall below where the diluted shares would be expected to pull the share price down to !!

Example: A company market cap is 50 million with a share count of 50 million , that would make the PPS $1.00 ... If you diluted the shares by a new 50 million then the PPS should fall to $0.50 PPS and the market cap will still be 50 million ... But if the share dilution cause's a sell off and the PPS falls to $0.25 PPS then the market cap is now 25 million !! So in this example "share dilution" may very well effect market cap ....

Your Welcome ,

IB_;)