Earnings Per Share (EPS) Calculator
What is an Earnings Per Share (EPS) Calculator?
An Earnings Per Share (EPS) Calculator helps determine the amount of a company’s profit allocated to each outstanding share of common stock. It’s a key metric for evaluating a company’s profitability on a per-share basis.
When to use an Earnings Per Share (EPS) Calculator?
Use this calculator when:
- You need to evaluate the profitability of a business as an investor or financial analyst.
- Comparing multiple companies to assess which offers better returns on investment.
- Presenting financial data for stakeholders or reporting purposes.
How to use an Earnings Per Share (EPS) Calculator?
1. Input the Net Income: The company's total profit.
2. Enter the Preferred Dividends: The dividends paid to preferred shareholders.
3. Add the Common Shares Outstanding: The total number of shares held by common shareholders.
4. Click Calculate EPS to compute the result.
The formula used is:
EPS = (Net Income - Preferred Dividends) ÷ Common Shares Outstanding
Who needs an Earnings Per Share (EPS) Calculator?
This tool is essential for:
- Investors: To evaluate a company’s earnings relative to each share of stock they own.
- Financial Analysts: For assessing company performance and making strategic recommendations.
- Corporate Executives: When reporting to shareholders or making financial forecasts.