How It Works

From SEC Filing to Risk Score in Seconds

We read the filings so you don't have to. Our AI extracts dilution-relevant data from SEC documents and synthesizes it into clear, actionable reports.

The Process

Five steps to dilution clarity

Step 01

You Search a Ticker

Enter any US-listed stock symbol. We cover everything in SEC EDGAR—from mega-caps to micro-caps, including foreign filers (20-F/40-F).

Step 02

We Pull SEC Filings

Our system retrieves the latest 10-Q/10-K, plus all 8-Ks since the last quarterly. We also pull S-1s, S-3 shelf registrations, and DEF 14A proxies for insider ownership.

Step 03

AI Extracts Dilution Data

Each filing runs through our extraction pipeline. We identify warrants, convertible notes, ATMs, equity lines, and shelf capacity—then reconcile data across filings to remove duplicates.

Step 04

We Calculate Float & Runway

Float is calculated from shares outstanding minus insider holdings, plus post-filing issuances. Cash runway comes from balance sheet cash divided by monthly burn rate.

Step 05

Master Auditor Synthesizes

All extracted data feeds into our auditor model, which assigns risk scores and generates a unified report with warrants, convertibles, ATMs, shelf capacity, and key findings.

Risk Scores

Understanding Our Risk Metrics

Every report includes four risk scores rated LOW, MEDIUM, HIGH, or SEVERE. Here's what each one measures.

Overall Risk

A composite score weighing all dilution factors. Combines offering ability, cash need, and float risk into one actionable rating.

Offering Ability

How easily can the company issue new shares? Factors in shelf registrations, ATM programs, equity lines, and authorized share headroom.

Cash Need

How urgently does the company need capital? Based on cash runway, burn rate, and upcoming debt maturities. Severe means dilution is likely imminent.

Float Risk

How much could the float expand? Accounts for warrants, convertible notes, registered shares for resale, and other potential share issuances.

Risk Level Guide

LOWMinimal concern
MEDIUMMonitor closely
HIGHSignificant risk
SEVEREExtreme caution

Data Sources

SEC Filings We Analyze

10-K

Annual reports with full financial statements, risk factors, and capital structure details

10-Q

Quarterly updates on financials, cash position, and recent equity transactions

8-K

Material events including new financing deals, warrant exercises, and offerings

S-1

IPO and registration statements detailing share structure and dilution risks

S-3

Shelf registrations showing future offering capacity and registered shares

Proxy (DEF 14A)

Equity incentive plans, authorized shares, and compensation-related dilution

Red Flags

Toxic Financing Terms We Detect

Not all dilution is created equal. These predatory financing structures can destroy shareholder value overnight.

Floating Conversion Price

high

Converts at a discount to market price (e.g., 85% of VWAP). The lower the stock goes, the more shares get issued.

Death Spiral

severe

A convertible with no floor price. Conversion can result in unlimited dilution as shares keep getting issued at lower prices.

Full Ratchet Anti-Dilution

high

If new shares are issued at a lower price, existing convertible holders get repriced down to match.

Original Issue Discount (OID)

medium

Investor pays less than face value (e.g., $800K for $1M note). Company owes more than it received.

Equity Line (ELOC/SEPA)

high

Standby facility to sell shares at a discount. Often used by cash-burning companies as a last resort.

Cashless Warrant Exercise

medium

Warrants converted without cash payment. Company gets no capital but still issues new shares.

Dilution Vectors

What We Track in Every Report

Warrants

Outstanding warrants, exercise prices, expiration dates, and cashless exercise provisions.

Convertible Notes

Principal amounts, conversion prices (fixed and floating), maturity dates, and toxic terms.

ATM Programs

At-the-market offering capacity, amounts used, and remaining availability.

Equity Lines (ELOC/SEPA)

Committed equity facilities, pricing discounts, and shares registered for resale.

Shelf Registrations

Total shelf capacity, amounts used, and remaining offering ability.

Equity Incentive Plans

Authorized shares, options outstanding, and unvested RSUs that could hit the float.

Under the Hood

Our Processing Pipeline

Every ticker runs through a multi-pass analysis system. Each pass focuses on specific data extraction and feeds into the final report.

1

Backbone Extraction

Downloads the latest 10-Q or 10-K as the baseline, then all 8-Ks filed since. Each document is processed to extract dilution instruments, then reconciled to deduplicate and apply newer data.

2

Float Calculation

Extracts shares outstanding from quarterly filings, insider ownership from DEF 14A proxy statements, and post-filing issuances from 8-Ks. Formula: Float = Outstanding - Insiders + New Issuances.

3

Shelf & Offering Analysis

Analyzes S-3 shelf registrations and S-1 offering documents to determine total registered capacity, amounts already used, and remaining offering ability.

4

Cash Runway Calculation

Pulls balance sheet (cash position) and cash flow statement (free cash flow) data. For cash-burning companies: Runway = Cash / Monthly Burn. Cash-flow positive companies show ">10 years".

5

Master Auditor

All pass results feed into the auditor, which synthesizes the data into a final report. Assigns risk levels based on offering ability, cash need, and float risk, then generates the structured dilution report.

See It In Action

What a Report Looks Like

dilutracker.com/ticker/smx
SMXSMX (Security Matters) PLC
Ireland · Specialty Business Services
$23.11-17.93%
Overall Risk
SEVERE
Offering Ability
HIGH
Cash Need
SEVERE
Float Risk
SEVERE
Key Findings
  • • $100M equity line at 94-98% of lowest prices
  • • Convertible notes with 15% discount to lowest VWAP
  • • 7 reverse stock splits since August 2023
  • • Est. runway: ~2 months

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