Earnings per Share

Earnings per Share Calculator

**This is a basic calculator and does not accept commas. When entering values, just enter the numbers.

Net Income :
Preferred Dividends :
Average Common Shares Outstanding :

Solution

Earnings per Share :   

    

 

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Earnings per Share Formula

**Note: Average common shares outstanding is calculated based on beginning period and ending period divided by 2, for example: (January 1 Assets + December 31 Assets) / 2.

 

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What is Earnings per Share?

Earnings per share is a measure that is evaluated in accounting and finance. It is a reflection of net income (or loss) per each share of the business outstanding stock. Preferred dividends reduce the net income because preferred shareholders get paid dividends first. It is important to note that this measure is so important that it is required to be reported on the Income Statement. Like many of the accounting ratios and measures, when evaluating this measure it is important to evaluate a company against other companies in the same industry, or use the specific industry average. Earnings per share is also used as part of the formula to determine the Price Earnings Ratio.