EPS

Earnings per share explained: how it’s calculated, basic versus diluted, why growth in EPS matters so much for stock prices, and what can distort it.

Profit per share

Earnings per share, or EPS, is a company’s profit divided by its number of shares. If a company earns $10 billion in a year and has 2 billion shares, its EPS is $5. EPS turns a company’s total profit into a per-share number that you can compare with the share price.

EPS is the E in the P/E ratio and the headline number in every earnings report.

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