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Glossary · Valuation

Earnings per share

Net profit divided by the number of shares.

Why it matters

Growth in earnings per share, over years, is what pushes share prices up over the long run.

How to read it

Watch whether EPS grows because profits grow, or only because the company bought back shares.

Also called: EPS

Related

P/E ratioShare price divided by the last 12 months of earnings per share.BuybacksA company buying its own shares, so each remaining share owns more of the business.

In the Cluenex app, this explanation opens next to every earnings per share figure, with the live reading for the stock you are looking at. Open it in Cluenex