Last updated: January 19, 2026
Earnings per share (EPS) divides net income by shares outstanding. It shows profit attributable to each share.
EPS growth is a key indicator analysts watch. Compare current EPS to prior periods and expectations.
Basic EPS uses outstanding shares; diluted EPS includes potential shares from options and convertibles.
Understanding earnings per share (eps) helps you make better investment decisions and plan for taxes. Explore related concepts below to deepen your knowledge.
EPS is the portion of a company's profit allocated to each outstanding share of common stock. It determines a company's profitability from the investor's perspective.
The basic formula is (Net Income - Preferred Dividends) divided by the weighted average of common shares outstanding.
Basic EPS only includes currently outstanding shares. Diluted EPS assumes all potential shares (like convertible bonds or stock options) are exercised, providing a more conservative view of profit.
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