The question of whether EPS (Earnings Per Share) is good or bad needs to be settled if owners of corporations want their companies to continue existing. Ignoring the answer to this important question will jeopardize their company’s ability to make profit and thus endanger their existence. Thankfully, Jeremy Goldstein has an answer to the question and has a solution to the problem that will satisfy both parties in the equation. His extensive experience in settling disputes of companies versus their employees will have a bearing on whether EPS is good or bad for a corporation.
Advocates of EPS claim that it is beneficial not only to the employees but also to their employers. Meanwhile, EPS detractors say that it will be disastrous to a company and to a larger extent, to the nation’s economy. Goldstein, who is a principal in Jeremy L. Goldstein and Associates, LLC proposes a compromise between the two sides. In the absence of another option, both parties should hear what Goldstein has to say.
EPS is basically a way to gauge the profitability of a corporation. It is a figure that can be calculated using the formula: EPS = (Net Income – Preferred Stock Dividends)/Average Outstanding Shares. As such, the company’s profit is broken down by its particular EPS on a per share basis. In other words, EPS is a way to show a company’s value.
The opponents of EPS say that there is a dark side to this system. They claim that because of the very competitive nature of trading and shares, company owners and corporations could use EPS to their advantage. If they use EPS with wrong motives, they could create a financial picture that shows the results they want, no matter what the actual financial situation is. They can do this to boost their income or sales. EPS, according to its detractors, could also endanger favoritism among the ranks of employees in a company.
Meanwhile, proponents of EPS are enthusiastic about its supposed benefits. They say EPS will encourage employers to increase the salaries of their workers. Furthermore, they say that it will encourage stakeholders of the company to sell or buy their shares. If only these two factors are considered, EPS could really be considered as beneficial to both employee and employer. Learn more: http://officialjeremygoldstein.com/philanthropy/
It is therefore obvious that these two sides will be in conflict with each other over the EPS issue. In this scenario, Goldstein is proposing a compromise. He suggests that instead of removing EPS, a company should make its owners and top executives more accountable to their actions. If the top management echelon will be more responsible with their decisions, there is no need to deprive employees with their deserved pay hikes. The employees will be happy to do their jobs and the company’s production will increase and so will its income and profit.