What is earning per sahre? how does it impact the share
holder?
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Answer Posted / satya
The portion of a company's profit allocated to each
outstanding share of common stock. Earnings per share
serves as an indicator of a company's profitability.
Calculated as:
When calculating, it is more accurate to use a weighted
average number of shares outstanding over the reporting
term, because the number of shares outstanding can change
over time. However, data sources sometimes simplify the
calculation by using the number of shares outstanding at
the end of the period.
Diluted EPS expands on basic EPS by including the shares of
convertibles or warrants outstanding in the outstanding
shares number.
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