ACCT323, Webapp, 16d
A. Go to http://biz.yahoo.com/r/ and click on Surprises (under Company Earnings). Choose a
recent day.
(1) Record the name and ticker of the company with a large negative EPS share surprise
(downside surprise).
(2) How should this negative surprise have affected the stock price (barring other factors)?
B. Refer to HP’s financial statements below to complete the questions about EPS.
(1) Why must companies such as HP show both a basic and diluted earnings per share?
(2) What type of potentially dilutive security caused HP’s dilution in EPS?
(3) T or F: HP offers both restricted stock and stock options to key employees.
(4) T or F: Employees earn the right to restricted stock over a vesting period that varies from
one to three years.
(5) T or F: The exercise price of the stock options is equal to the closing price of HP stock on
the date of grant.
(6) T or F: HP uses the Black & Scholes Option Model to value the stock options.
(7) What is the difference between a stock option and a stock warrant, if any?