Earnings per share is the monetary value of earnings per outstanding share of common stock for a company.

What is the formula for earnings per share?

Earnings per share or basic earnings per share is calculated by subtracting preferred dividends from net income and dividing by the weighted average common shares outstanding.

What is earning per share?

Earnings per share (EPS) is a company's net profit divided by the number of common shares it has outstanding. ... A higher EPS indicates greater value because investors will pay more for a company's shares if they think the company has higher profits relative to its share price.