Ebit-eps break-even analysis ndashthis is algebraic, Ask an Expert

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EBIT-EPS break-even analysis –this is algebraic formulas , Home Depot Inc (HD) had 1244 million shares of common stock outstanding in 2016. Whereas Lowes companies Inc. (LOW) had 929 million shares outstanding. Assuming Home Depot’s 2016 interest expense is $919 million, Lowe’s interest expense is $552 million, and a 40 percent tax rate for both firms, what is their break-even level of operating income. (i.e. the level of EBIT where EPS is the same for both firms)?

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