Earnings per Share (EPS)
- The above is subject to the 20% limit test. Not stressed as its status in the new statement is unclear. To review: If you need to reacquire > 20% of the outstanding stock then it is assumed only 20% of the shares may be reacquired. Any excess is presumed to be new shares. Any excess proceeds are assumed to be used to retire first short-term and then long-term debt. If any excess still remains it is assumed that government securities are purchased as investments. Under this scenario it is possible then the assumed exercise of warrants can alter BOTH the numerator and denominator. It is conceivable that the warrants could then be anti-dilutive.