[Verse 1] When investors want to know how much a company earned They look beyond the total to see what each share returned Net income tells the story but it's not the final call We need to break it down per share to understand it all [Chorus] Basic EPS, it's easy as can be Net income divided by shares outstanding, you see Take the profit, divide it right By weighted average shares in sight Basic EPS shows profitability Per share for you and me [Verse 2] Start with net income at the bottom of the sheet That's the profit after all expenses have been beat But shares can change throughout the year, they're not always the same So weighted average is the key to play this calculation game [Chorus] Basic EPS, it's easy as can be Net income divided by shares outstanding, you see Take the profit, divide it right By weighted average shares in sight Basic EPS shows profitability Per share for you and me [Bridge] If shares were issued mid-year through Count them for the months they grew January to December's end Weight each month, then we can blend Million shares times twelve months strong Equals twelve million share-months long [Verse 3] Let's say net income hit five million this past year And weighted average shares were two point five million here Five divided by two point five equals two dollars clean That's two dollars earned per share, the best measure you've seen [Chorus] Basic EPS, it's easy as can be Net income divided by shares outstanding, you see Take the profit, divide it right By weighted average shares in sight Basic EPS shows profitability Per share for you and me [Outro] Now you know the foundation strong For analyzing all year long Basic EPS will be your guide To see where profits truly hide
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