| Earnings
per Share - EPS |
 |
|
=
|
Net
Income - Dividends on Preferred Stock
|
|
|
|
Average
Outstanding Shares
|
Net income
for a specific period divided by the number of outstanding shares.
Companies usually use a weighted average number of shares outstanding
over reporting term.
|
 |
This
is the single most popular variable in dictating a shares price -
it indicates the profitability of a company.
The diluted
EPS means that the outstanding shares include any convertible's or
warrants outstanding.
If
the company issues more shares then EPS are much harder to compare
to previous years. |
|
|
|
|
Dictionary
