MoneyWeek videos masthead

What are earnings per share?

Tim Bennett explains ‘earnings per share’ – a vital number for investors which can give you an idea of a company’s performance over time.

• See also: A beginner’s guide to the price/earnings ratio

• See all MoneyWeek videos here.

• To download the videos to your mobile device via iTunes, click here.

• Get all of our latest video tutorials sent straight to your inbox every week - sign up FREE to MoneyWeek Videos here.

Earnings per share

Earnings per share is seen as one of the best means of determining a share’s true price, as it shows how much of a firm’s profits (after tax) each shareholder owns. It is calculated by dividing a company’s net earnings by the number of shares issued, and is most often used as a means of comparing one company with another, assuming that they are in the same industry. So if a company had net earnings of £1,000 with 200 shares issued, it would have an EPS of 5. By looking at the EPS over several years you can look for a growth pattern and compare it with the market and industry.

• Entry from MoneyWeek’s Financial glossary.

Video tutorial - what is the current ratio?

What is the ‘current ratio’?

In his latest video, Ed Bowsher looks at the current ratio, which can help you see whether a company has sufficient resources to pay its bills in the near future.

Video tutorial - investing in gold

How to buy gold

In his latest video, Ed Bowsher visits a London gold dealer, looks at various gold bars and coins, and makes his first purchase of physical gold.

Video tutorial: should you invest in TSB?

Should you invest in TSB?

Ed Bowsher looks at TSB’s imminent stock market flotation. Are the shares worth buying – and if you want to buy them, how do you go about it?

Shale gas 'fracking' promises to transform Britain's energy market. Find out what it is, what it means, and how to invest.
MoneyWeek videos masthead

MoneyWeek Videos is our free weekly video email which breaks down the complicated world of finance and helps you understand what's really going on. Every week, MoneyWeek's Ed Bowsher takes a key piece of financial news or jargon and explains it. To join MoneyWeek Videos for free, just enter your email address.

To sign-up enter your email address.



A note about our free emails, advertising, and how to unsubscribe.

Because these emails are completely free, we do have to fund them with advertising. Occasionally we will send you separate promotional emails, which will contain advertisements from us or from other companies. By signing up to our free emails, you are consenting to receive these promotions. However we will never give, sell or rent your email address to any other companies. And if you want to stop receiving our free emails at any time, you can immediately unsubscribe by clicking on the link at the top of each email, or by calling us on 0207 633 3780. For more information, please see our Privacy policy.

Comment on this article