Earnings Per Share (EPS)
Net income attributable to each share of common stock.
What is Earnings Per Share (EPS)?
Net income minus preferred dividends, divided by weighted average shares outstanding. The denominator matters: buybacks raise EPS without any improvement in the business.
Earnings Per Share (EPS): a worked example
$100M net income and 50M shares gives $2.00 EPS.
More terms in Valuation & Analysis
Market Capitalization
Share price times shares outstanding - the equity value of a company.
Price-to-Earnings (P/E) Ratio
Price per share divided by earnings per share.
Dividend Yield
Annual dividends per share divided by share price.
Payout Ratio
The share of earnings paid out as dividends.
Book Value
Assets minus liabilities - the accounting value of equity.
Free Cash Flow
Operating cash flow minus capital expenditures.
EBITDA
Earnings before interest, taxes, depreciation, and amortization.
Return on Equity (ROE)
Net income divided by shareholders' equity.