Formula

Calculating Earnings Per Share (EPS): Formula & Examples

3 min read

Earnings per share (EPS) is an important indicator of a company’s profitability. It is calculated by dividing the net income of a company by the total number of outstanding shares. For instance, if a company has reported net income of $1 million and it has 10 million shares outstanding, then its EPS would be 0.1 or 10 cents. EPS is a tool used by forex investors to evaluate a company’s financial performance. It also serves as a benchmark for assessing the value of a company’s stock.