Basic Earnings Per Share CalculatorFree online financial calculator — instant results, no sign-up
Calculate basic EPS from net income, preferred dividends and weighted-average common shares.
Estimates only, based on the inputs and assumptions shown. This is not financial, investment, tax, or legal advice. Prices, rates and local rules may change; crypto scenarios do not predict returns. Confirm important decisions with a qualified professional.
Sign in to save results and favorites.
About the Basic Earnings Per Share Calculator
The Basic Earnings Per Share Calculator calculates the earnings attributable to each weighted-average common share from net income, preferred dividends, and weighted-average common shares. It subtracts preferred dividends from net income before dividing by the share count. With the default inputs, basic earnings per share is $2.40.
- Net income ($)
- The company's profit or loss for the reporting period, in dollars, before subtracting preferred dividends for this EPS calculation; the default is $5,000,000.
- Preferred dividends ($)
- The preferred dividends attributable to the reporting period that must be deducted to determine earnings available to common shareholders, in dollars; the default is $200,000.
- Weighted-average common shares (shares)
- The average common shares outstanding during the reporting period, weighted by how long they were outstanding and expressed in shares; the default is 2,000,000.
Formula and method
Basic EPS = (NI − PD) / WACS = ($5,000,000 − $200,000) / 2,000,000 shares = $2.40 per share.
- Basic EPSBasic earnings per common share for the reporting period, expressed in dollars per share.
- NINet income for the reporting period, in dollars.
- PDPreferred dividends deducted for the reporting period, in dollars.
- WACSWeighted-average common shares outstanding during the same reporting period, in shares.
Subtract preferred dividends from net income to obtain earnings available to common shareholders, then divide by weighted-average common shares. For the default inputs, $5,000,000 minus $200,000 equals $4,800,000, and $4,800,000 divided by 2,000,000 shares gives basic EPS of $2.40.
Worked example
These are the calculator's starting values and the results it actually produces for them.
Inputs
- Net income5000000 $
- Preferred dividends200000 $
- Weighted-average common shares2000000 shares
Results
- Basic earnings per share$2.40
How to use the Basic Earnings Per Share Calculator
- 1Choose a reporting period and enter its net income in dollars; the default is 5000000.
- 2Enter the preferred dividends attributable to that period in dollars; the default is 200000.
- 3Enter weighted-average common shares for the same period, using a positive share count; the default is 2000000.
- 4Calculate basic EPS by subtracting preferred dividends from net income and dividing by the weighted-average share count.
- 5Read the basic earnings per share result in dollars per share; the default inputs produce $2.40.
Reading your result
The Basic earnings per share output shows earnings available to common shareholders per weighted-average common share for the selected period. A result of $2.40 means the company generated $2.40 of earnings attributable to each such share, not that it paid a $2.40 dividend. A negative result indicates a loss available to common shareholders, while zero indicates no earnings remaining after preferred dividends.
Limitations
All inputs must cover the same reporting period and use consistent dollar and share units. Weighted-average common shares must be greater than zero and must be supplied by the user; this tool does not derive them from issuance dates, repurchases, or stock splits. It calculates basic EPS, not diluted EPS, and does not adjust for options, convertible securities, participating securities, or other complex earnings-allocation requirements. The user must determine the appropriate preferred-dividend deduction under the applicable accounting rules. EPS alone does not measure cash flow, investment value, or dividends paid, and quarterly EPS should not be compared directly with annual EPS.
Common questions
Why are preferred dividends subtracted from net income?+
Basic EPS measures earnings available to common shareholders, so earnings attributable to preferred shareholders are deducted first. With the default inputs, subtracting $200,000 from $5,000,000 leaves $4,800,000 for common shareholders.
Can I use the common shares outstanding at the end of the period?+
Only if that count also represents the appropriate weighted-average count for the period. Issuances and repurchases can change the average, and stock splits can require retrospective adjustments; use the weighted-average common shares reported or calculated for basic EPS.
What should I enter if the company has no preferred dividends?+
Enter zero if no preferred-dividend deduction applies. For cumulative preferred stock, the current period's dividend entitlement generally must be deducted even if it was not declared, so a lack of cash payments does not necessarily mean the input is zero.
Is the $2.40 result basic EPS or diluted EPS?+
It is basic EPS: ($5,000,000 − $200,000) divided by 2,000,000 common shares. Diluted EPS requires considering potentially dilutive securities and may require adjustments to both earnings and shares that this calculator does not perform.
Does the calculator save my information?+
Calculations run in your browser. While signed in, inputs and results are automatically recorded in account history; saving a result creates a separate saved record.
You might also like
Interest Calculator
Growth of savings with compound interest and regular deposits.
Investment Calculator
Project an investment with monthly contributions.
Finance Calculator
Solve for future value from present value, rate, periods and payment.
Compound Interest Calculator
Compare compounding frequencies and see the effective rate.
Interest Rate Calculator
Find the rate on a loan from amount, payment and term.
Savings Calculator
How savings grow with deposits, interest and tax.
Results are estimates for informational purposes and are not financial, medical or legal advice.