Executives of public companies felt compelled to keep earnings per share rising to keep pace with the stock market, said Alon Kapen, a partner at the Uniondale law firm Farrell Fritz.
“There’s pressure on them . . . to justify their stock prices,” he said. “Earnings haven’t risen commensurate with [stock] prices.”
Their choices: grow the company organically, increase per-share value by buying back stock, or make acquisitions in an effort to increase earnings.
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