Go to Jeff Salisbury LWGate Home Page.From: "Katherine Malm" <kmalm@earthlink.net>
Subject: Re: [CANSLIM] EPS
Date: Mon, 28 Jan 2002 23:10:40 -0600
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When the company buys back shares and turns them into treasury stock, =
they are considered issued but no longer outstanding. you can look in =
the 10Q to see the number of shares used in computing the EPS. Look in =
the balance sheet section to see a reconciliation of shares issued, =
outstanding, etc.
Here's an example from DOCC's latest 10Q found at =
http://www.sec.gov/Archives/edgar/data/1033864/000095013401509538/d92952e=
10-q.txt
Katherine
=3D=3D=3D=3D=3D
<!--StartFragment-->NOTE 3 - NET INCOME PER SHARE
The Company's basic and diluted net income per share are computed in =
accordance
with Statement of Financial Accounting Standards No. 128, "Earnings Per =
Share"
("SFAS 128"). Basic net income per share is computed using the weighted =
average
number of common shares outstanding. Diluted net income per share is =
computed
using the weighted average number of common shares outstanding and the =
assumed
exercise of stock options and warrants (using the treasury stock =
method). The
following is a reconciliation of the shares used in computing basic and =
diluted
net income per share for the periods indicated (in thousands):
<Table>
<Caption>
=
Three months ended
=
October 31,
=
- -----------------------------
=
2001 2000
=
- ------------- -------------
<S> <C> =
<C>
Shares used in computing basic net income per share =
13,624 14,960
Dilutive effect of stock options and warrants =
753 847
=
- ------------- -------------
Shares used in computing diluted net income per share =
14,377 15,807
=
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D =
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D
----- Original Message -----=20
From: Scott Gettis=20
To: canslim@lists.xmission.com=20
Sent: Monday, January 28, 2002 10:58 PM
Subject: [CANSLIM] EPS
when a company buys back shares, does the number of outstanding shares =
decrease? If so, then it is possible for a company to show earnings =
growth due to the fact that there are less shares outstanding. Thus the =
companys earnings are not really growing.
=20
-----Original Message-----
From: owner-canslim@lists.xmission.com =
[mailto:owner-canslim@lists.xmission.com]On Behalf Of Katherine Malm
Sent: Monday, January 28, 2002 8:52 PM
To: canslim@lists.xmission.com
Subject: Re: [CANSLIM] docc
Hi Scott,
The rest of the 41% not owned by management is owned by SFE, an =
"incubator" that has a portfolio of companies in which it maintains a =
substantial portion of the outstanding shares. See =
http://www.safeguard.com/investorfs.html for a list. You see this kind =
of discrepancy in the numbers quite often when a stock is spun off from =
a parent or from an incubator and not all shares are distributed to the =
public in the spin off.
Katherine
----- Original Message -----=20
From: Scott Gettis=20
To: canslim@lists.xmission.com=20
Sent: Monday, January 28, 2002 10:30 PM
Subject: [CANSLIM] docc
dgo list the management ownership as 18%.
however the (1 - float/total share outstanding)* 100 =3D 41% ?=20
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<DIV>When the company buys back shares and turns them into treasury =
stock, they=20
are considered issued but no longer outstanding. you can look in the 10Q =
to see=20
the number of shares used in computing the EPS. Look in the balance =
sheet=20
section to see a reconciliation of shares issued, outstanding, =
etc.</DIV>
<DIV> </DIV>
<DIV>Here's an example from DOCC's latest 10Q found at <A=20
href=3D"http://www.sec.gov/Archives/edgar/data/1033864/000095013401509538=
/d92952e10-q.txt">http://www.sec.gov/Archives/edgar/data/1033864/00009501=
3401509538/d92952e10-q.txt</A></DIV>
<DIV> </DIV>
<DIV>Katherine</DIV>
<DIV> </DIV>
<DIV>=3D=3D=3D=3D=3D</DIV>
<DIV><!--StartFragment-->NOTE 3 - NET INCOME PER SHARE<BR><BR>The=20
Company's basic and diluted net income per share are computed in=20
accordance<BR>with Statement of Financial Accounting Standards No. 128,=20
"Earnings Per Share"<BR>("SFAS 128"). Basic net income per share is =
computed=20
using the weighted average<BR>number of common shares outstanding. =
Diluted net=20
income per share is computed<BR>using the weighted average number of =
common=20
shares outstanding and the assumed<BR>exercise of stock options and =
warrants=20
(using the treasury stock method). The<BR>following is a reconciliation =
of the=20
shares used in computing basic and diluted<BR>net income per share for =
the=20
periods indicated (in=20
thousands):<BR><BR><BR><Table><BR><Caption><BR> &n=
bsp; &nb=
sp; &nbs=
p;  =
; =
&=
nbsp; =20
Three months=20
ended<BR> &nbs=
p;  =
; =
&=
nbsp; &n=
bsp; &nb=
sp; =20
October=20
31,<BR> =
&=
nbsp; &n=
bsp; &nb=
sp; &nbs=
p; =20
- -----------------------------<BR> &nbs=
p;  =
; =
&=
nbsp; &n=
bsp; &nb=
sp; =20
2001 &nb=
sp;=20
2000<BR>  =
; =
&=
nbsp; &n=
bsp; &nb=
sp; =20
- ------------- =20
- -------------<BR><S>  =
; =
&=
nbsp; &n=
bsp; &nb=
sp; =20
<C> &nbs=
p; =20
<C><BR>Shares used in computing basic net income per=20
share &n=
bsp; =20
13,624 =20
14,960<BR><BR>Dilutive effect of stock options and=20
warrants  =
; =
=20
753 &nbs=
p;=20
847<BR> =
&=
nbsp; &n=
bsp; &nb=
sp; &nbs=
p; =20
- ------------- -------------<BR><BR>Shares used in computing =
diluted=20
net income per=20
share &n=
bsp; =20
14,377 =20
15,807<BR> &nb=
sp; &nbs=
p;  =
; =
&=
nbsp; =20
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D =
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D<BR></DIV>
<BLOCKQUOTE dir=3Dltr=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dsgettis@ucla.edu href=3D"mailto:sgettis@ucla.edu">Scott =
Gettis</A>=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A =
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Monday, January 28, 2002 =
10:58=20
PM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> [CANSLIM] EPS</DIV>
<DIV><BR></DIV>
<DIV><SPAN class=3D764045604-29012002><FONT face=3DArial =
color=3D#0000ff size=3D2>when=20
a company buys back shares, does the number of outstanding shares=20
decrease? If so, then it is possible for a company to show =
earnings=20
growth due to the fact that there are less shares outstanding. =
Thus the=20
companys earnings are not really growing.</FONT></SPAN></DIV><SPAN=20
class=3D764045604-29012002></SPAN><FONT face=3DTahoma>
<DIV><BR><FONT size=3D2><SPAN=20
class=3D764045604-29012002></SPAN></FONT> </DIV>
<DIV><FONT size=3D2><SPAN =
class=3D764045604-29012002> </SPAN>-----Original=20
Message-----<BR><B>From:</B> <A=20
=
href=3D"mailto:owner-canslim@lists.xmission.com">owner-canslim@lists.xmis=
sion.com</A>=20
[mailto:owner-canslim@lists.xmission.com]<B>On Behalf Of </B>Katherine =
Malm<BR><B>Sent:</B> Monday, January 28, 2002 8:52 PM<BR><B>To:</B>=20
canslim@lists.xmission.com<BR><B>Subject:</B> Re: [CANSLIM]=20
docc<BR><BR></DIV></FONT></FONT>
<BLOCKQUOTE dir=3Dltr style=3D"MARGIN-RIGHT: 0px">
<DIV>Hi Scott,</DIV>
<DIV> </DIV>
<DIV>The rest of the 41% not owned by management is owned =
by SFE,=20
an "incubator" that has a portfolio of companies in which it =
maintains=20
a substantial portion of the outstanding shares. See <A=20
=
href=3D"http://www.safeguard.com/investorfs.html">http://www.safeguard.co=
m/investorfs.html</A> for=20
a list. You see this kind of discrepancy in the numbers quite often =
when a=20
stock is spun off from a parent or from an incubator and not all =
shares are=20
distributed to the public in the spin off.</DIV>
<DIV> </DIV>
<DIV>Katherine</DIV>
<BLOCKQUOTE=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
<DIV style=3D"FONT: 10pt arial">----- Original Message ----- =
</DIV>
<DIV=20
style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: =
black"><B>From:</B>=20
<A title=3Dsgettis@ucla.edu href=3D"mailto:sgettis@ucla.edu">Scott =
Gettis</A>=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>To:</B> <A=20
title=3Dcanslim@lists.xmission.com=20
=
href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>=
=20
</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Monday, January 28, =
2002 10:30=20
PM</DIV>
<DIV style=3D"FONT: 10pt arial"><B>Subject:</B> [CANSLIM] =
docc</DIV>
<DIV><BR></DIV><BR>dgo list the management ownership as =
18%.<BR>however=20
the (1 - float/total share outstanding)* 100 =3D 41% ? =
<BR><BR>-<BR>-To=20
subscribe/unsubscribe, email "<A=20
=
href=3D"mailto:majordomo@xmission.com">majordomo@xmission.com</A>"<BR>-In=
=20
the email body, write "subscribe canslim" or<BR>-"unsubscribe=20
canslim". Do not use quotes in your=20
email.</BLOCKQUOTE></BLOCKQUOTE></BLOCKQUOTE></BODY></HTML>
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Next Article (by Author): [CANSLIM] docc "Scott Gettis"
Previous Article (by Author): Re: [CANSLIM] docc "Katherine Malm"
Top of Thread: [CANSLIM] EPS "Scott Gettis"
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