Earnings Per Share (EPS)

Earnings per share is a financial metric that indicates how much profit a company makes for each share of its stock. It is calculated by dividing the company's net income by the total number of outstanding shares. A higher EPS often suggests that a company is more profitable and has more profits to distribute to shareholders or reinvest in growth. Investors use EPS to gauge a company's profitability and to make comparisons between different companies' financial performances.