Reading Financials3 min read
What is EPS (earnings per share)?
EPS slices a company's profit down to a single share. It is the building block behind the P/E ratio.
Earnings per share, or EPS, is a company's net profit divided by its number of shares. It tells you how much profit is attributable to each single share.
Why it matters
EPS lets you compare profitability across companies of different sizes on a per-share basis. Rising EPS over time is generally a healthy sign, and it is the denominator that feeds into the P/E ratio.