If dividend is the part of the earnings that is distributed to its shareholders, how to understand Earnings Per Share?
Please help me in understanding the difference.
Thanks.
2006-10-30 07:49:10 · 8 answers · asked by HelloWorld 1 in Business & Finance ➔ Investing
EPS, also known as Earnings per share, is the companies income divided by the number of shares outstanding. This can also be broken down into diluted EPS, which is usually better for analysis. A dividend is the money tha the company actually distributed to its shareholders. There can be, and usually is a difference between EPS and dividends.
2006-10-30 08:03:59 · answer #1 · answered by Dave 3 · 0⤊ 0⤋
Dividends are profits distributed to the shareholders
EPS is the amount of income the company has made. You can determine how well a company is doing by the EPS.
Depending on what the investment goal is for a particular company determines the dividend payouts. If the company is looking to grow its shareprice it won't distribute money in a dividend, however the EPS will be high.
2006-10-30 08:08:20 · answer #2 · answered by doof55 2 · 0⤊ 0⤋
EPS is how much the company earned per each share of stock... to make it easy, say a company has 1 million shares of stock and it earned 2 million dollars that year... the EPS would be $2.00 (2 million divided by 1 million)... EPS and DIVIDEND are not directly related.
2016-03-28 01:55:13 · answer #3 · answered by Anonymous · 0⤊ 0⤋
EPS is earning per share. If there are 100 shares outstanding and the company made $100. It is $1 per share earning. Dividend is something that company is paying you a certain % on your shares you own. If a company pays 1% dividend on $100 per share price. You get $1 per share dividend. Check out XOM, it pays good dividend and there is a growth due to high oil pricing.
2006-10-30 10:16:55 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Earnings Per Share (EPS) is the amount of earning per share for a particular period of time. Dividends are payouts to investors, which are declared by the board of directors. However, they are not the same. A company who has earnings per share of say $5 would not declare a dividend of $5. Many companies have to use their EPS to reinvest in their business, like R&D, exploration, new building(s) or equipment.
2006-10-30 07:56:29 · answer #5 · answered by jim 6 · 1⤊ 0⤋
EPS is what a company earns per share after expenses of running a company they could pay out a dividend from these earnings.
2006-11-05 14:39:21 · answer #6 · answered by Bruce (Bill) B 2 · 0⤊ 0⤋
Earnings equal sales minus cost
EPS = earrings divided by number of shares
Dividends are paid out
EPS are a calculated abstract used for performance measurement
2006-10-30 07:57:51 · answer #7 · answered by Irish Wander 3 · 0⤊ 0⤋
Same as in apples to oranges.
2006-10-30 08:45:35 · answer #8 · answered by Psychedelico 3 · 0⤊ 1⤋