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Earnings Per Share Ratio Calculator - Glossary:
Using our earnings per share ratio calculator, helps to compare, measure, understand the overall health of the business.
Earnings Per Share Ratio:
Earnings per share denotes the money you would earn for owning each share of common stock.
How to calculate?
Earnings Per Share Ratio = (Net Income - Preferred Dividends)/Weighted Average Shares Outstanding
The values are commonly stated against Net Income and preferred dividend in the income statement and the weighted average shares outstanding in the balance sheet.
Profit before deducting all its interest & taxes.
Preferred dividends are cash distributions that are paid to the owners of a company's preferred shares.
Weighted Average Shares Outstanding:
Weighted average shares outstanding is a calculation that incorporates any changes in the number of outstanding shares over a reporting period.
A company with a net income of $160,000 pays out $10,000 in dividends to preferred shareholders and has a weighted average shares outstanding - 50,000, then its earnings per share (EPS) will be $3.
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