There are proponents and detractors of Earnings Per Share or EPS. Both have their own ideas of how good and how bad this thing is. It is a bone of contention that seems to have no answer. Its advocates say that EPS will enhance the sustainability of a company, while its adversaries claim that corporations can use it to further their own interests. It seems that this thorny issue is hard to resolve. Thankfully, Jeremy Goldstein, a practicing lawyer in New York City, has an answer that will enable the two sides to get what they want.
Earnings per share is the aspect of a company that can show its profitability. It is fundamentally a part of the company’s profit which is apportioned to its common stock’s outstanding share. In effect, EPS can break down the company’s profit on a per share basis. There is a formula that companies use to calculate their EPS. The formula is: EPS = (Net Income – Preferred Stock) / Average Outstanding Shares. EPS is a way by which a company or a business entity is valuated.
Goldstein is positioning himself in between the proponents of EPS and its detractors. He proposes a compromise to help the two resolve their differences. Goldstein knows what he is saying because as a New York City lawyer, he has been resolving issues on this subject. His extensive experience in successfully resolving the issues regarding EPS between employers and employees can be used to find the ultimate solution to this question.
Detractors of EPS claim that employers and business owners can take unfair advantages of some of its features because of the nature of shares and trading which remains very competitive. They also say that EPS can be used by company owners to show an attractive financial picture even if the real picture is not that promising. EPS, they also claim, can be a cause for company favoritism.
EPS proponents, on the other hand, claim that company owners can use it to reward its workers with pay hikes. Furthermore, they say that EPS can be used by business owners to influence their shareholders to buy or sell their stocks. If these claims are true, company owner can leverage EPS to encourage its growth and therefore ensure its sustainability.
Based on his extensive experience in resolving disputes between workers and company owners, Goldstein believes that compromise is the best solution to this problem. Goldstein’s proposal is: rather than abolishing EPS, company owners should be held accountable for all the decisions they make that will affect their company’s sustainability and growth. In the process, employees can still enjoy the benefits of EPS, and will be happy doing their work and their performance and productivity will improve. As a result, the company will also benefit because of the increased productivity of its employees. Learn more: https://lawyers.justia.com/lawyer/jeremy-goldstein-1275422