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StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.Simple Definition
Earnings Per Share. How much profit a company makes per share of stock.
Why It Matters
EPS is the heartbeat of a stock's value. When Apple reports EPS of $6.50, that means every share 'earned' $6.50 in profit last year. Rising EPS usually means rising stock prices. Companies report EPS every quarter - beats or misses can send stocks soaring or crashing.
Key Points
- Calculate it: Net Income ÷ Total Shares Outstanding
- Analysts predict EPS ahead of earnings reports - 'beats' are good, 'misses' are bad
- Watch EPS growth year-over-year, not just the raw number
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Related Terms
Common Questions
Earnings Per Share. How much profit a company makes per share of stock. EPS is the heartbeat of a stock's value. When Apple reports EPS of $6.
EPS is the heartbeat of a stock's value. When Apple reports EPS of $6.50, that means every share 'earned' $6.50 in profit last year. Rising EPS usually means rising stock prices. Companies report EPS every quarter - beats or misses can send stocks soaring or crashing.
Calculate it: Net Income ÷ Total Shares Outstanding
Analysts predict EPS ahead of earnings reports - 'beats' are good, 'misses' are bad
Watch EPS growth year-over-year, not just the raw number