Please help me to figure out EPS issue. Googling didn’t help me, all hope for you.
Company A earned $10 bln, it has 1 bln shares. Its market cap is $100 bln, share price is $100.
Company B earned $10 bln, but it has 10 bln shares. Its market cap is also $100 bln, share price is $10.
These two companies are quite the same but EPS of company A is 10. EPS for company B is $1.
How can you compare EPS of companies that are free to choose the number of stocks they are willing to issue?
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