BASIC EARNINGS PER SHARE

The financial organization has an approximate calculation of income that can be designated to one share of its stock is called basic earnings per share. Basic (EPS) do not factor in the weak effects on corporate securities. Basic EPS can be calculated as follows:

Basic EPS = (net income – preferred dividends) / weighted average number of natural shares outstanding

If a business related organization has an uncomplicated capital system, indicating that it has not published any conceivable financial instruments, basic EPS can be a valuable metric on its own.