Outstanding Shares Definition


Outstanding shares are the shares of a corporation that are issued and held by shareholders, and are available for trade. Also known as outstanding capital stock, or stock outstanding. If the company buys back the shares, the repurchased shares are no longer outstanding.

The number of outstanding shares is used in the calculation of dividends or earnings per share. Shares outstanding can either be "primary" (primary EPS) or "fully diluted" (diluted EPS). The Diluted Earnings per Share refers to the EPS of a publicly-traded company calculated on the assumption that all convertible securities (such as stock options, convertible bonds, etc.) were converted into shares of common stock.

The earnings per share (EPS) is calculated by taking the net earnings and divide by the outstanding shares.

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