Finance glossary
Earnings Per Share (EPS)
Definition
A company net profit divided by its outstanding shares.
EPS measures how much profit is attributable to each share of stock, calculated as net income minus preferred dividends, divided by shares outstanding. It is a core input to the P/E ratio. Diluted EPS accounts for options and convertibles that could increase the share count.
In a sentence
The company beat estimates with Earnings Per Share (EPS) of $2.10, lifting the stock after hours.
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