Earnings per Share EPS Growth Rates Definition & Meaning | Fundamental Analysis | CSIMarket
CSI Market
Sign In | Register

Glossary

Earnings per Share EPS Growth Rates

Fundamental Analysis

Earnings per Share (EPS) Growth Rate refers to the percentage increase or decrease in the earnings per share of a company over a specific period of time. It is an essential metric used in fundamental analysis for evaluating the profitability of a company. EPS growth rate tells investors how much profit the company made for each outstanding share of common stock. A higher EPS growth rate indicates that the company is generating more profit per share than in the previous period, which is usually a good sign for investors.

The formula for EPS Growth Rates is:

EPS Growth Rate = [(Current year EPS - Previous year EPS) / Previous year EPS] x 100

For example, if a company*s EPS in the current year is $3 and the EPS in the previous year was $2, the EPS Growth Rate would be:

EPS Growth Rate = [(3-2) / 2] x 100 = 50%

This implies that the company*s EPS has grown by 50% over the period.

EPS growth rate is used in fundamental analysis to evaluate a company*s profitability and to compare it to other companies in similar industries or sectors. A higher EPS growth rate is generally seen as a positive indication that the company is performing well and is likely to continue to grow its earnings in the future. However, it should be noted that a high EPS growth rate may not always be sustainable and may be influenced by temporary or unsustainable factors such as one-time gains or favorable market conditions.

EPS Growth Rate can also be used to estimate the future value of a company*s stock. The higher the EPS growth rate, the more valuable the company*s stock is likely to be. Conversely, if the EPS growth rate is negative or very low, it may indicate that the company is experiencing financial difficulties.

In conclusion, EPS growth rate is an important metric in fundamental analysis used to evaluate a company*s profitability and potential future growth and is usually calculated by investors to determine a company*s stock value.




More Glossary Terms Beginning with E
  • E-Commerce
    The sale of goods and services where the buyer places an order, or the price and terms of the sale are negotiated over an Electronic Data Interchange, the Internet, or any other online system (extranet, e-mail, instant messaging). Payment may or may not be made online.
    Economy Term Letter: E
  • Earned Premiums or Premiums Earned
    That portion of property casualty premiums written that applies to the expired portion of the policy term. Earned premiums are recognized as revenues under both Statutory Accounting Practices (SAP) and GAAP.
    Insurance Term Letter: E
  • Earnings per Share basic
    The companys earnings divided by the average number of shares outstanding for the period. Statement of Income
    Financial Term Letter: E
  • Earnings per Share diluted
    The companys earnings divided by the average number of shares outstanding for the period, giving effect to assumed dilution from outstanding stock options and restricted stock units. Earnings per Share
    Financial Term Letter: E
  • Earnings per Share EPS Growth Rates
    The percentage of EPS change within a specific period (Y/Y year on year; Seq sequential, from proceeding period; TTM trailing twelve months).
    Fundamental Analysis Letter: E
  • Effective Tax Rate
    Provision for income taxes as a percentage of earnings from continuing operations before income taxes and accounting changes. Does not represent cash paid for income taxes in the current accounting period. Also referred to as "actual tax rate" or "tax rate."
    Financial Term Letter: E
  • EITF
    Emerging Issues Task Force
    Financial Term Letter: E
  • Electro Optic Materials
    Electro-optic materials are materials that are engineered at the molecular level. Molecular level engineering is commonly referred to as "nanotechnology."
    Manufacturing Term Letter: E
  • Electrolysis
    A process of separating bonded elements and compounds by passing an electric current through them.
    Manufacturing Term Letter: E
  • Electrolytic Plant
    A plant that processes purifying metal ingots that are suspended as anodes in an electrolytic bath, alternated with refined sheets of the same metal which act as starters or cathodes.
    Manufacturing Term Letter: E
  • Eligible Bank
    A bank selected by Seller and approved by Buyer in writing and authorized to conduct trust and other banking business in any state in which Seller conducts operations.
    Financial Term Letter: E
  • Eligible Swap Counterparty
    means an entity, which may be an affiliate of a remarketing agent, engaged in the business of entering into derivative instrument contracts that satisfies the Rating Agency Condition.
    Financial Term Letter: E
Get Earnings per Share EPS Growth Rates's full dataset: Subscribe API License