Question

Assuming the number of shares outstanding remains constant an increase in dividends per share will reduce that

Answer 1

Earnings per share (EPS) is a ratio that gauges how profitable a company is per share of its stock. It represents a company's net income allotted to each share of its common stock. Basic EPS is calculated as (net income - preferred stock dividends) ÷ (outstanding shares).

Answer 2

Explanation:

On the balance sheet, a share repurchase will reduce the company's cash holdings, and consequently its total assets base, by the amount of the cash expended in the buyback.

The buyback will simultaneously also shrink shareholders' equity on the liabilities side by the same amount.