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can someone help me on Diluted Earnings per share?

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can someone help me on Diluted Earnings per share?

pls can someone in the group help me with some concise explanations on EPS and DEPS?

April 24th 2015 AN ACCA USER 760 Points

2 Replies

0 Votes

Net income ÷ Total number of capital stock shares = EPS

April 26th 2015 AN ACCA USER 370 Points
0 Votes
Earnings per share and dividends per share both indicate the future prospects of the firm in terms of shareholder’s return and income allocated per shareholder. However, the two are different from each other in that earnings per share measures the $ value of net income that is available for each of the company’s outstanding shares, and dividends per share shows the portion of profits that is paid out as dividends per share. The value of earnings per share will give the investor an idea of the value of dividends to expect, as dividends are a portion of the company’s net earnings that are distributed to shareholders. The earnings per share measures a firm’s profitability, and the higher the EPS the better. However, higher dividends per share may indicate that the firm cannot reinvest enough funds back into the firm; therefore, distributing those funds. This must be considered in light with the fact that a firm with very high growth rates usually reinvest surplus income, instead of paying dividends.
April 26th 2015 AN ACCA USER 370 Points
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