What is Earning per share and diluted earning per share ? How do we calculate the same ? Is it necessary to disclose them in Annual Reports ?

Start networking and exchanging professional insights

Next Question:
What is the formula for calculating earnings per share (EPS)?
Posted by:
Mohammad Iqbal Abubaker
26-March-2017

Question added by C S Raghunandan Chikkaballapur Rao , Freelancer : , Presently Working for : Brindavan Agencies,Kreations and Sreevamsa sales Organisation.
Date Posted: 2015/04/23

Upvote (0) Views (2) Followers (1) Answers (1) Report Question

Write an Answer
Register now or log in to answer.

1 Answers

by Shahbaz Hayder , Group Head of Finance , Sharif Group of Companies

Earnings per share (EPS) is the monetary value of earnings per outstanding share of common stock for a company.

FORMULA

Basic EPS= (Net income - Preferred dividends) / Weighted average number of common stock outstanding

Diluted earnings per share (diluted EPS) is a company's earnings per share calculated using fully diluted shares outstanding.

FORMULA

Diluted EPS = (Net income- Preferred dividends + Income adjustments due to dilutive financial instruments) / (Weighted average number of common shares outstanding+Newly issuable shares due to dilutive financial instruments)

Yes it is necessary to disclose EPS and Diluted EPS in Annual Report.

Upvote (2)

Downvote Reply () Report