Earnings per Share (Diluted)

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Earnings per Share (eps) is the amount of earnings per outstanding share of the company™s stock. In calculating earnings per share, the dividends of preferred stocks need to subtracted from the total net income first. The formula of the calculation is Earnings per Share (eps) = ({Net Income} - {Preferred Dividends})/{Shares Outstanding} Companies also reported diluted shares in their financial reports. Diluted shares include the shares of convertibles or warrants outstanding.