Price earnings is a short form for The ratio of price of the stock and the earning per share. So a stock pays $2.00(per year or over previous 12 month period) in dividend and it is selling at $100.00 per share. PE will be 100/2=50 For the same stock earnings per share is $2.00 per year.
by minootoo - 21 hours ago
the big difference is that the P/E is a reflection of future earnings of a company, though EPS is the dividend the company has issued per share. so while the former will give the expectation of all future earnings ( market price of the share) against its present performance the latter is merely a statement of the dividend issued per share by a company. P/E: Price of a stock divided by its earnings per share. The price-earnings ratio, also known as the multiple, gives investors an idea of how much they are paying for a company's earning power. EPS: The portion of a company's profit allocated to each outstanding share of common stock. The amount is computed by dividing net earnings by the number of outstanding shares of common stock. For example, a corporation that earned $10 million last year and has 10 million shares outstanding would report earnings per share of $1.
by vagarant - 21 hours ago
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