A public company’s earnings per share (“EPS”) is one of the most used metrics for determining its profitability. (Jason Fernando, Investopedia). EPS is a formula that calculates a company’s profit by dividing its net income by its outstanding shares of stock. Id. A company’s goal is to meet or exceed its consensus EPS estimate, as this demonstrates a successful quarter and shows investors a reliable stock…
Read MoreCongress enacted the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) as a direct response to the 2008 Financial Crisis when millions of Americans lost homes due to foreclosure. (SEC). Among myriad findings, a final report on the 2008 Financial Crisis stated that investment transactions with conflicts of interest contributed to the crisis. (Financial Crisis Inquiry Commission). For example, the commission found that financial firms marketed an investment and profited off that investment product’s decline…
Read MoreAfter spending seven years as a proposal in limbo, the Securities and Exchange Commission ("SEC") adopted a "Pay Versus Performance" rule in August of 2022, finally meeting the statutory mandate set forth in the Dodd-Frank Act. (Candance Quinn, et. al., Bloomberg Law). As the rule’s name implies, SEC registrants must now disclose the interplay between their executive compensation actually paid and the company's financial performance. (PricewaterhouseCoopers). An additional requirement under the new rule has drawn scrutiny as it opens the door for Environmental Social Governance ("ESG") disclosures to be made…
Read MoreIn February 2016, Congress passed the bipartisan SEC Small Business Advocate Act of 2016 (the “Act”). The Act amended the Securities Exchange Act of 1934 to establish an independent Office of the Advocate for Small Business Capital Formation (the “Office”) within the Securities and Exchange Commission (“SEC”). (H.R. 3784). Officially established in 2019, the Office aims to assist and advance the interests of small businesses and their investors in securing access to capital and complying with SEC regulations…
Read MoreOn March 21, 2022, the Securities and Exchange Commission (“SEC”) issued a rule proposal addressing Environmental, Social, and Governance (“ESG”) disclosure regulation, a concern of many investors. (SEC Press Release). The rule proposal targets disclosure of environmental issues by public companies in their required financial statements. Id. Republicans and many industry groups strongly opposed the rule, arguing that the rule would cause an unwarranted spike in compliance costs…
Read MoreOnce valued at $32 billion, crypto exchange FTX Trading Ltd. (“FTX”) shocked the world as it collapsed and filed for bankruptcy at the end of 2022. (Max Zahn, ABC News). An article by CoinDesk initially triggered the crypto exchange fall when it reported that FTX and Alameda Research—a crypto trading firm founded by FTX founder, Sam Bankman-Fried—shared excessively close relationships and blurred finances. (Ian Allison, CoinDesk). Following the report, concerned investors requested withdrawals from the exchange, which caused the value of FTT—FTX’s native token—to nosedive…
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