This Earnings per Share (EPS) template breaks down the calculation of the ratio. EPS is an important financial ratio and can be obtained by dividing the net earnings available to common shareholders by the average outstanding shares over a certain period of time.

Below are two versions of the earnings per share formula:

​EPS = (Net Income – Preferred Dividends) / End of period Shares Outstanding

or

EPS = (Net Income – Preferred Dividends) / Weighted Average Shares Outstanding

The EPS formula calculation is typically dependent on the financial instruments that compose the company’s capital structure. In this template we assume there are only common and preferred shares outstanding.