Above-the-line entries refer to those listed above the horizontal line on a company's profit and loss account, reflecting normal business activities. This accounting practice is critical for understanding how a company's earnings are generated.
An essential figure representing net profit after tax, utilized in financial performance metrics such as earnings per share.
A financial structure with stock outstanding that has potential for dilution, requiring a dual presentation of earnings per share by showing primary earnings per common share and fully diluted earnings per common share.
Dilution refers to the reduction in earnings per share (EPS) and book value per share that occurs when convertible securities, such as convertible bonds and preferred shares, or warrants and stock options, are converted into common stock.
Earnings, also referred to as net income or profit, is a crucial metric in financial reporting which forms the basis for calculating earnings per share. A key aspect of corporate finance, earnings definition and reporting have evolved to curb creative accounting and ensure transparency.
Earnings Per Share (EPS) represents a portion of a company's profit allocated to each outstanding share of its common stock. It is a significant factor in evaluating a company's profitability and its stock outlook.
A comprehensive exploration of Earnings Per Share (EPS), detailing its calculation, significance, and application under International Accounting Standards.
Earnings yield is the ratio of the earnings per share of a company to the market price of the share, expressed as a percentage. It is an important metric for evaluating the profitability of a company relative to its share price.
A figure showing earnings per common share after assuming the exercise of all outstanding warrants and stock options, and the conversion of convertible bonds and preferred stock, all potentially dilutive securities.
Fully Diluted Earnings Per Share (EPS) for a company that takes into account not only the number of shares in issue but also those that may be issued as a result of such factors as convertible loans, options, or warrants. International Accounting Standard 33 requires that diluted earnings per share be disclosed on the face of the profit and loss account as well as basic earnings per share. The US equivalent is primary earnings per share.
Brief summaries of financial information often given some prominence in the annual accounts and report of a company. Highlights typically include key metrics such as sales revenue, profits, earnings per share, and dividends for the current and previous financial years.
The net basis is the method used to calculate a company's earnings per share (EPS), incorporating both constant and variable elements in the company's tax charge. Under International Accounting Standard 33, listed companies must display EPS on the net basis in their profit and loss statements.
Net Income Per Share, also known as Earnings Per Share (EPS), is the amount of profit or earnings allocated to each share of common stock after all costs, taxes, depreciation, and possible losses have been deducted.
A foundation used to calculate a company's earnings per share (EPS) focusing only on the constant elements in the company's tax charge; often contrasted with net basis.
The Price-Earnings (P/E) Ratio signifies the price of a stock divided by its earnings per share (EPS), acting as a multiple. It offers insights into market expectations regarding a company’s future earning power.
Primary earnings per (common) share refers to the earnings available to common stockholders divided by the number of common shares outstanding.
Residual Equity Theory emphasizes the rights and interests of ordinary shareholders, viewing them as the real owners of a business. It reflects in earnings per share, aiding shareholder investment decisions. This theory positions itself between the proprietary view and the entity view of a company.
A stock repurchase plan, also known as a share buyback, is a program by which a corporation buys back its own shares from the open market. Typically deployed when shares are perceived as undervalued, this practice reduces the number of shares outstanding, thus raising earnings per share (EPS) and potentially increasing the market value of the remaining shares.
