What is earnings per share (EPS)?

Earnings per share (EPS) is a measure of a company's profitability that indicates how much profit each outstanding share of common stock has earned. It's calculated by dividing the company's net income by the total number of outstanding shares. The higher a company's EPS, the more profitable it is considered to be.

How do you calculate earnings per share (EPS)?

It's calculated by dividing the company's net income by the total number of outstanding shares. The higher a company's EPS, the more profitable it is considered to be. Earnings per share (EPS) is a company's net income subtracted by preferred dividends and then divided by the number of common shares it has outstanding.

What is basic earnings per share?

Basic earnings per share is a rough measurement of the amount of a company's profit that can be allocated to one share of its common stock. Businesses with simple capital structures, where only common stock has been issued, need only release this ratio to reveal their profitability.