Eps formula: Learn how to calculate

Learn how to calculate earnings per share , understand the difference between basic and diluted EPS , and see how finance teams use it to track profitability. Earnings per share (EPS ) measures a company's profit per share of common stock. Learn what EPS means, how to calculate it, and why it matters to investors. Learn how to calculate EPS, a financial ratio that indicates a company’s ability to produce net profits for common shareholders. See different versions of the EPS formula, an example calculation, and a video explanation. How is EPS Calculated - EPS Formula and Example With the Earnings Per Share meaning clarified, let us take a look at the mathematical formula for its calculation: EPS = (Net income - Preferred dividends) / Average outstanding shares Let us understand the EPS calculation with the help of an example.