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Investing Glossary:
Earnings per share (EPS)
Copyright 2010,
Campbell R. Harvey. All Rights Reserved.
Do not reproduce without explicit permission.
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| A company`s Profit divided by its number of Outstanding shares. If a Company earning $2 million in one year had $2 million Shares of Stock outstanding, its EPS would be $1 per share. In calculating EPS, the company often uses a weighted Average of shares outstanding over the reporting term. The one-year (historical) EPS growth rate is calculated as the percentage change in Earnings per share. The prospective EPS growth rate is calculated as the percentage change in this year`s earnings and the Consensus forecast earnings for next year.
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