What is P/E Ratio , Face Value & EPS

V

vijayvaliya

Active Member
#2
#2
thejatanuja said:
Hi,

I am new to the stock market. Please Explain me what is What is P/E Ratio , Face Value & EPS.

Thanks & Regards,
Bharath Theja.
Click to expand...
P/E stands for Price earning ratio Current prices is divided by earnings per share. Earning per share is arrived at by Net profit/Total no of shares outstanding.

Face value is the value (denomination) on which the share are issued. That decides the extend of your liability in the company's ownership.
 
R

rvm123

Active Member
#3
#3
eps is "earnings per share". this denotes the earnings made by a company for each share. that means, net profit divided by the total number of shares is the eps of the company. it shows the earning capacity of the company. hence, higher the eps, it is advantageous

p/e ratio is 'market price' of the share divided by 'eps' of the company. this denotes whether the company's shares are under priced or over priced. a company with a lesser p/e ratio is considered to be under priced and their prices are bound to go up, in the normal conditions.

face value of a share is the original price of the share over which eps, book value, etc will be calculate. if a share whose face value is Rs.10/- is being quoted in the market for Rs.250/-, if the company declares a dividend of say 50%, the shareholders will get Rs.5/- per share as dividend (i.e., 50% of the face value - Rs.10/-)
 
R

rsr58

New Member
#4
#4
EPS Mean
The portion of a company's profit allocated to each outstanding share of common stock. Earnings per share serves as an indicator of a company's profitability.

Calculated as: = Net Income - Dividends on Preferred Stock / Averge outstanding Shares


For example, assume that a company has a net income of $25 million. If the company pays out $1 million in preferred dividends and has 10 million shares for half of the year and 15 million shares for the other half, the EPS would be $1.92 (24/12.5). First, the $1 million is deducted from the net income to get $24 million, then a weighted average is taken to find the number of shares outstanding (0.5 x 10M+ 0.5 x 15M = 12.5M).
 
K

keyant

New Member
#5
#5
P/E ratio or price earnings ratio- this is the company’s total market capitalization(market cap) dividend by its total earnings for the last 12 months. In other words, it is the price paid per share relative to the company’s earnings per share. It is always a figure like 10 or 74 etc
 
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