The EBIT-EPS analysis, as a method to study the effect of leverage, essentially involves the comparison of alternative methods of financing under various assumptions of EBIT.
EBIT-EPS Break-Even Analysis -- Analysis of the effect of financing alternatives on earnings per share.The break-even point is the EBIT level where EPS is the same for two (or more) alternatives.
If a company need to raise additional money by issuing either debt,preffered stock & common stock.Which alternative will allow company to have highest EPS? This is called EBIT-EPS analysis
okkkkk.... now i got it is just a technique to determine which option is better to choose for a company in order to raise its capital which will also increase its earning per share. isn't it????