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Earnings per Share Calculator

# Earnings Per Share Calculator

The earnings per share (EPS) is the portion of company’s total profit in share holders. The Earnings per share equal to net income less than dividends on preferred stock divided average out standing common shares.

**Formula us**

EPS = (net income – dividends on preferred stock) / average outstanding common shares

**let us consider,**

**Net income**total earnings (profit) of the company, calculated as the costs subtracted from the total revenue.**Dividends on preferred stock**preferred stock is a class of assets that gives the shareholders priority over the common stock.**Average outstanding common shares**the number of shares currently held by the shareholders.

**Example**

- Determine the net income of the company. Let’s assume that it is equal to $2.12 billion.
- Calculate the total sum of dividends on preferred stock. We can assume it is equal to $300 million.

3.Determine the number of outstanding common shares for this company. We can choose a number of 222.4 million

**calculate the Earnings per share**

EPS = (net income – dividends on preferred stock) / average outstanding common shares

EPS = ($2,120,000,000 – $300,000,000) / 222,400,000

The answer is earnings per share = $8.18