What is earning per share (EPS)?

The earning per share (EPS) is the ratio between a company’s net income and its weighted average number of common shares outstanding. Generally, a higher EPS ratio is perceived more positively by the market, as it implies the company is more profitable per share (and vice versa).

What happens to eps if earnings go up?

If earnings go up or the number of shares decreases, EPS will rise. If earnings decrease or the number of shares increases, EPS will decline as well. EPS is a market multiple ratio, meaning it simplifies financial statements into a number that can be compared to peers. While useful, this is a snapshot and does have limitations.

How do I know if a company has EPs?

If you don’t need to see a company’s EPS right at the moment it’s released, you can also check a financial data website, such as Yahoo Finance, which typically updates its EPS data by the end of the day of a company’s most recent earnings report. You may notice that there are two different EPS numbers in the table above: basic and diluted.