Example:Financial Leverage,EPS,and ROE-I We will ignore the effect of taxes at this stage What happens to EPS and ROE when we issue debt and buy back shares of stock? Fin ancial Leverage Ex ample 66 Example: Financial Leverage, EPS, and ROE - I n We will ignore the effect of taxes at this stage n What happens to EPS and ROE when we issue debt and buy back shares of stock?