False Growth

What is False Growth?

The increase in earnings per share that comes against a firm acquires another firm with a P/E ratio lower than its original price-earnings ratio.

And this phenomenon is solely because of the merge. The stock price does not matter.

When a corporation merges a comparatively small company with a lower P/E ratio,there wil be a false growth in the corporation's earnings per share.

See stock, price, merge

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False Growth Edit Meaning