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• Earnings Per Share
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
BMC Software 1990s
1 Revenues, net earnings, and earnings per share increased approximately 50% over
1990
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Goldman Sachs - Corporate affairs
1 In 2013, the firm reported earnings of US$9.34 billion and record earnings per share
of $160.66
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Starbucks
1 By September 1992, the share price had risen 70% to over 100 times the earnings per share of the previous
year
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Spend management - Cost reduction vs. revenue generation
1 Companies divide money into two major buckets - revenue and cost. In hard economic times, when revenue
is harder to come by, companies often turn to cost reduction
initiatives. Cost cutting will increase net income. An increase in net
income leads to a greater earnings per share and ultimately a higher
market value (higher market capitalization).
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
BP - Stock
1 The buyback decision followed closure of the TNK-BP deal and it has to offset the dilution to earnings per share following the loss of dividends
from TNK-BP
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Walmart - Initiatives (2005–present)
1 Income from continuing operations increased 3 percent to $13.3billion,
and earnings per share rose 6 percent to $3.35
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Zain - Financial Highlights
1 Earnings per share for the 12 months stood at USD 0.23 (KD 0.065),
compared to USD 0.27 (KD 0.073) in the previous year
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Security (finance) - Hybrid
1 Warrants, like other convertible securities, increases the number of shares outstanding, and are always accounted for in financial reports as
fully diluted earnings per share, which assumes that all warrants and
convertibles will be exercised.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Taiwan High Speed Rail - Revenue and Cost
1 For the first time in its five-year operation, the Company reported a net income of NT$5.78 billion, with
earnings per share of NT$0.59
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Corporate finance - Capitalization structure
1 Also, Capital structure substitution theory hypothesizes that
management manipulates the capital structure such that earnings per
share (EPS) are maximized
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Executive pay - Restricted stock
1 These performance conditions could be earnings per share or internal financial
targets.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Mondelēz International - Acquisition fallout
1 Kraft chief executive Irene Rosenfeld said, “We expect it will remain weak for the foreseeable future.” Taking into account integration costs, the acquisition knocked about 33% off
Kraft's earnings per share immediately after the purchase of
Cadbury
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Dividend - Reliability of dividends
1 Payout ratio is calculated by dividing the company's dividend by the
earnings per share. A payout ratio greater than 1 means the company is paying out more in dividends for the
year than it earned.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Stockout - Impact
1 A loss of sales of 4 percent translates into a earnings per share loss of about $0.012 (1.2 cents) for the
average firm in the grocery retailing sector, where the average earnings
per share, already is about $0.25 (25 cents) per year.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Income statement - Earnings per share
1 Because of its importance, earnings per share (EPS) are required to be
disclosed on the face of the income statement. A company which reports any of the irregular items must also report EPS for these items either in
the statement or in the notes.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Capital structure - Other
1 * Capital structure substitution theory—managements of public companies manipulate capital
structure such that earnings per share are maximized.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Yield (finance) - Preferred shares
1 Like bonds, preferred shares compensate owners with scheduled payments which resemble interest. However, preferred
interest is actually in the form of a dividend. This is a significant accounting difference as preferred dividends, unlike debt interest, are charged after taxes and below net income,
therefore reducing net income and ultimately earnings per share. Preferred shares may also contain conversion privileges which allow for
their exchange into common stock.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Valuation using multiples - Valuation multiples
1 In stock trading, one of the most widely used multiples is the P/E ratio|price-
earnings ratio (P/E ratio or PER) which is popular in part due to its wide availability
and to the importance ascribed to earnings per share as a value driver. However, the usefulness of P/E ratios is lessened by the fact that earnings per share is subject to distortions from differences in accounting
rules and capital structures between companies.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Stock dilution
1 This dilution can shift fundamental positions of the stock such as ownership percentage, voting
control, earnings per share, and the value of individual shares
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Rights issue - Basic example
1 If the company were to do nothing with the raised money, its Earnings
per share (EPS) would be reduced by half
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Share repurchase - Purpose
1 or publicly traded shares, means that even if profits remain the same, the
earnings per share increase
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Share repurchase - Purpose
1 Further, increasing earnings per share does not equate to increases in shareholder value
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Share repurchase - Purpose
1 Safeguards should be in place to ensure that decisions about share
buybacks are not motivated by their effect on executive or managerial reward. Earnings per share targets
need adjusting to take out the financial leveraging effect of the
buyback and similarly share incentive schemes need adjusting to
neutralize unwarranted enhancement.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Share repurchase - Tax-efficient distribution of earnings
1 This means that instead of receiving 10¢ of earnings per share, they
receive 8.5¢ (.10×(1−.15)) at a 15% tax rate with 1.5¢ going to the
government
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Enterprise value - Avoiding temporal mismatches
1 When calculating multiples over different time periods (e.g. historic multiples vs
forward multiples), EV should be adjusted to reflect the weighted average invested
capital of the company in each period.This is analogous to the way
earnings per share (net income / weighted average number of shares) is influenced by changes in the number of
shares over different financial years.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Follow-on offering
1 When new shares are created and then sold by the company, the number of shares outstanding
increases and this causes dilution of earnings on a Earnings per share|per
share basis
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Lubrizol
1 On the basis of 2010 profitability metrics, total shareholder return
(TSR) and earnings per share growth, Lubrizol was the top performing
company among the 16 chemical companies that are on the Fortune
500.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Accretion/dilution analysis
1 'Accretion/dilution analysis' is a type of Mergers and Acquisitions|MA financial modelling performed in
the pre-deal phase to evaluate the effect of the transaction on shareholder value and to check
whether earnings per share|EPS for buying shareholders will increase or decrease post-deal.
[http://www.investopedia.com/articles/fundamental-analysis/09/accretion-dilution-analysis-mergers.asp
Accretion / Dilution Analysis: A Merger Mystery] Generally, shareholders do not prefer dilutive
transactions; however, if the deal may generate enough value to become accretive in a reasonable
time, a proposed combination is justified.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Sainsbury's - Sainsbury's heyday
1 In 1991, the group boasted a 12-year record of dividend increases of 20% or more and earnings per share had risen by as much for nearly as long.
Also in 1991 the company raised £489million in new equity to fund the
expansion of superstores.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Performance paradox - Change in dominant measures
1 A compilation of surveys examining the stated financial goals of
companies over the century found the following: companies strove to maximize market share in the late
1960s; earnings per share in the mid-1970s; return on equity in the early
1980s; and cash flow and share prices in present day
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Restricted stock
1 Restricted stock is often used as a form of employee compensation, in
which case it typically becomes transferrable (vesting|vests) upon
the satisfaction of certain conditions, such as continued employment for a
period of time and sometimes the achievement of particular earnings per share goals or other financial
targetshttps://store.theartofservice.com/the-earnings-per-share-toolkit.html
Magna International - Restatement
1 On May 18, 2000, the company restated its net income and earnings
per share (previously $109 million and $1.22 respectively) due to an
accounting policy change relating to design and engineering and pre-
production start-up costs. On May 2, 2001, the company restated diluted
earnings per share (previously $1.55) due to an accounting policy change
related to the adoption of the treasury stock method.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Earnings per share
1 'Earnings per share' (EPS) is the monetary value of earnings per each
outstanding share of a company's common stock.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Earnings per share - Calculating EPS
1 ;Earnings per share (basic formula)
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Earnings per share - Calculating EPS
1 ;Earnings per share (continuing
operations formula)
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio
1 The 'price-to-earnings ratio', or 'P/E ratio', is an equity valuation using multiples|valuation multiple. It is defined as market price per share
divided by annual earnings per share.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio - Versions
1 Monthly earnings data for individual companies are not available, and in
any case usually fluctuate seasonally, so the previous four
quarterly earnings reports are used and earnings per share are updated
quarterly
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio - Versions
1 As an example, if stock A is trading at $24 and the earnings per share for the most
recent 12-month period is $3, then stock A has a P/E ratio of 24/3 or 8. Put another
way, the purchaser of the stock is paying $8 for every dollar of earnings. Companies with losses (negative earnings) or no profit have an undefined P/E ratio (usually shown as not applicable or N/A); sometimes, however, a
negative P/E ratio may be shown.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio - Versions
1 Some people mistakenly use the formula market capitalization / net income to
calculate the P/E ratio. This formula often gives the same answer as market price / earnings per share, but if new capital has been issued it gives the wrong answer, as Market capitalisation|market capitalization = market price × current number of shares whereas earnings per share= net income /
weighted average number of shares.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio - Interpretation
1 By comparing price and earnings per share for a company, one can
analyze the market's stock valuation of a company and its shares relative
to the income the company is actually generating
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio - Interpretation
1 Since fundamental investors acknowledge that, over the long term, the price paid for a share of
stock is generally proportionate to the underlying company's earnings per share, the
median of high and low P/E ratios over a period of at least five years may be used as a proxy for a reasonable P/E ratio. This metric is sometimes
referred to as a company's signature P/E.Ellis Traub, Take Stock: A Roadmap to Profiting from
your First Walk Down Wall Street, 3rd ed. StockCentral Books, 2010, 63,64
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio - The P/E ratio in business culture
1 Consequently, managers have strong incentives to boost earnings per
share, even in the short term, and/or improve long term growth rates. This can influence business decisions in
several ways:
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Earnings yield
1 Earnings yield is the quotient of earnings per share divided by the
share price. It is the reciprocal of the P/E ratio.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
EPS - Other
1 * Earnings per share, a company's total earnings divided by the number of
outstanding shares
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Dividend discount model - Problems with the model
1 One common technique is to assume that the Modigliani-Miller theorem|
Miller-Modigliani hypothesis of dividend irrelevance is true, and
therefore replace the stocks's dividend D with E earnings per share
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Treasury stock - Benefits
1 Additionally, buying back shares will improve P/E ratios|price/earnings
ratios due to the reduced number of shares(and unchanged earnings) and
improve earnings per share ratios due to fewer shares outstanding (and
unchanged earnings).
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
OmniVision - Lawsuits
1 For the nine months ended January 31, 2004, the restatement increased revenue by $8.9 million, net income by $2.7 million and diluted earnings
per share by $0.04 over the amounts previously reported
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Family Dollar - History
1 In March 2005, Family Dollar restated the company's fiscal 2000 to fiscal 2004 earnings per share downward
by 2 cents to 3 cents a year, to correct lease-accounting issues.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Return on equity - The formula
1 High ROE yields no immediate benefit. Since stock prices are most strongly determined by earnings per share (EPS), you will be paying twice as much (in Price/Book terms) for a
20% ROE company as for a 10% ROE company.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Return on equity - The formula
1 *Remember that ROE is calculated from the company's perspective, on
the company as a whole. Since much financial manipulation is
accomplished with new share issues and buyback, always recalculate on a
'per share' basis, i.e., earnings per share/book value per share.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Kraft - Acquisition fallout
1 Kraft chief executive Irene Rosenfeld said, “We expect it will remain weak for the foreseeable future.” Taking into account integration costs, the acquisition knocked about 33% off
Kraft's earnings per share immediately after the purchase of
Cadbury
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Muscat Securities Market - MSM-30 index
1 3. The free float and capping has been revised (re-set) on a quarterly
basis. The revision is conducted quarterly, by end of March, June,
September and December. The index sample amendment, on the other
hand, takes place in the beginning of July of each year. The sample is
selected based on the applicable selection criteria (market
capitalization, liquidity, and earnings per share).
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Earnings growth - Historical growth rates
1 According to economist Robert Shiller, earnings per share on the SP 500 grew at a 3.8% annualized rate between 1874 and 2004 (inflation-
adjusted growth rate was 1.7%).http://www.marketwatch.com/News/Story/8kcdFFrMdjF2qXDNJf15SQf?siteid=mktwdist=TNMostMailed MARK HULBERT, Trees don't grow to
the sky, April 11, 2006https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Dividend cover
1 'Dividend cover' is the ratio of company's earnings (net income) over the dividend
paid to shareholders, calculated as earnings per share divided by the dividend per
share.[http://www.thisismoney.co.uk/news/columnists/article.html?
in_article_id=422933in_page_id=19ito=1565 Dividend cover] So, if a company has
earnings per share of $10.00 and it pays out a dividend of $2.00, the dividend cover
is 5.0x.https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Dividend cover - Basic formula
1 *Note that dividend cover is the reciprocal of dividend payout ratio,
which is calculated as Dividend|DPS/earnings per share|EPS.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
PEG ratio
1 The 'PEG ratio' (P/E ratio|price/earnings to Earnings
growth|growth ratio) is a valuation metric for determining the relative
trade-off between the price of a stock, the earnings generated per
share (Earnings per share|EPS), and the company's expected growth.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
KB Kookmin Bank
1 According to the company website, Kookmin Earnings per share|EPS in 2006 was 6977 South Korean won, and the dividend paid was 550 won per share. In September 2006 the
share price was 73,000 won.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Diluted Earnings Per Share
1 'Diluted Earnings Per Share (diluted EPS)' is a company's earnings per share (EPS) calculated using fully diluted shares outstanding (i.e.
including the impact of stock option grants and convertible bonds).
Diluted EPS indicates a worst case scenario, one that reflects the
issuance of stock for all outstanding options, warrants and convertible
securities that would reduce earnings per share.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Diluted Earnings Per Share - International financial reporting standards
1 Under International Financial Reporting Standards, diluted
earnings per share is calculated by adjusting the earnings and number of
shares for the effects of dilutive options and other dilutive potential common stock. Dilutive potential
common stock includes:
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Capital structure substitution theory
1 The CSS theory hypothesizes that managements of public companies manipulate capital structure such that earnings per share (EPS) are
maximized
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Business-agile enterprise - Overview
1 Business-agile enterprise improves financial measurements such as
margins, profitability, time to market, revenue growth, earnings per share,
ebitda (earnings before interest, taxes, depreciation amortization,
return on equity), return on assets, and return on investments.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Business-agile enterprise - Business Technology Management Institute, Agility research
1 * Average Annual Earnings per Share – 36% growth vs 7% for their industry groups
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
AVX Corporation
1 Capital expenditure for the year 2010 was at a five-year low of
$28.888 million 34.6% lower than the year before and 2.5 times less than in 2008, earnings per share grew 78.7% even though total sales fell (although revenue grew with each
successive quarter since April 2009)
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Ron Williams - Aetna Leadership
1 In 2011, full year operating earnings were $2.0 billion with operating
earnings per share of $5.17 producing a 12.3 percent operating
EPS CAGR over the last five years.[6]
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
MTC-Vodafone - Financial Highlights
1 For the first six months of 2014, Zain Group generated consolidated revenues of USD 2.23 billion (KD 627 million), up 3%
year-on-year. The company’s consolidated EBITDA for the period reached USD 943 million (KD 265 million), reflecting an
increase of 1% Y-o-Y. Earnings per share for the period stood at USD 0.10 (KD 0.029). http://www.commsmea.com/14400-zain-group-first-half-revenues-hit-223-billion
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Syntel - Finances
1 According to Syntel's Third Quarter 2014 financial results, the company posted revenue of $228.3 million, up
9% from year ago and flat sequentially. Syntel's Q3 2014
Earnings per share|EPS stands at $1.47 per diluted share, a 4%
sequential improvement and up 3% from year-ago quarter. The
company's employee count stands at 24,333 globally as of September 30,
2014.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Johnson Controls - History
1 and 2004 and the first three quarters of fiscal 2005. The changes would
have no impact on net income, earnings per share or the financial
position as previously reported.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Foster's Group - Business
1 Foster's announced yearly results which ended on 30 June 2009. The net sales
revenue increases by 2.7% to $4.5 billion. Net profit increases by 4.0% to $741.5m
and earnings per share increases by 4.6% to 38.5 cents.[http://spirits.drinks-
business-review.com/news/fosters_full_year_profit_increases_090824 Foster's 2009 net sales] Earnings per share increases
by 4.6%
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Earnings call
1 The name comes from the bottom line numbers in the income statement - earnings
per share
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Earnings call
1 Many companies are tracked by financial analysts that publish
estimates of earnings per share. The company may also provide Guidance
(finance)|guidance as to what earnings per share are likely to be. If management knows that its results
are going to be significantly different from its guidance or from analyst
expectations, it may choose to make a preannouncement of differing
results.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
SodaStream - 2010 Nasdaq IPO
1 During 2012, the stock experienced aggressive growth, with earnings per share
growing 57%
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Kingspan Group - History
1 The intention is to give their customers improved efficiency and reduce impact on the environment.
[http://www.kingspan.com/kingspangroup/sustainableconstruction/low_energy_carbon/ Kingspan Low Energy carbon] This policy appears to be yielding results as
revenue, profit and earnings per share have increased year-on-year since
2009.[http://www.kingspan.ie/kingspangroup/investors/ Investors Section of Kingspan Group website] Despite
this, 2010 showed the first growth in sales for three years.[http://www.rte.ie/news/2011/0228/kingspan-business.html Kingspan sees first growth for three
years]
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
State Bank of Travancore
1 The Earnings per share improved to Rs
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Development of The Elder Scrolls IV: Oblivion - Release delays
1 News of the delay came at a time following a burst of bad news from the company, including a 60% drop in expected earnings per share, the
ongoing Hot Coffee minigame controversy, worse than average sales for the company's flagship Grand Theft Auto: San Andreas,
sudden drops in share prices, and delays for other company products.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Steven Reinemund
1 During his CEO tenure at PepsiCo, revenues grew by $9 billion, net income rose 70%,
earnings per share were up 80% and PepsiCo’s market cap exceeded $100
billion.[http://www.pepsico.com/PressRelease/PepsiCos-Board-of-Directors-Appoints-
Indra-K-Nooyi.html PepsiCo press release] He led the acquisitions of several other food and beverage companies including Quaker Oats, Naked Juice, Izze and Stacy’s Chips.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Cabela's
1 Earnings per share came in at $0.70 which was higher than 2012's earnings of $0.60 per
share.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Investing.com - Financial Calendars
1 * Earnings calendar: Introduced in 2013, the earnings calendar tracks
the published forecasts for quarterly and annual earnings reports, displays expected earnings per share prior to
seasonal release and, along with actual outcomes, posts
previous/actual earnings per share, from companies worldwide.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Goldman Sachs Group - Corporate affairs
1 As of 2013, Goldman Sachs employed 31,700 people worldwide.[http://hereisthecity.com/2013/07/16/
how-did-goldmans-first-half-employee-compensation-come-out/
Goldman Sachs - employee compensation by the numbers - HITC Business] In 2013, the firm reported earnings of $9.34billion and record
earnings per share of $160.66https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Transocean - Controversies
1 On 30 October 2002, Transocean Inc. reported that its diluted earnings per share for the three months released
from 29 October 2002 to 30 September 2002, was understated by
$0.01 per share.
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Mondelez - Acquisition fallout
1 Kraft chief executive Irene Rosenfeld said, “We expect it will remain weak for the foreseeable future.” Taking into account integration costs, the acquisition knocked about 33% off
Kraft's earnings per share immediately after the purchase of
Cadbury
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
Renationalization of YPF - Resulting dispute
1 Repsol officials calculated compensation by multiplying the
highest price earnings ratio reached by YPF in the prior two years by its
earnings per share in 2011, and arrived at US$10.5 billion for a 57%
stake
https://store.theartofservice.com/the-earnings-per-share-toolkit.html
P/E ratio - Historical P/E ratios for the US stock market
1 The average P/E of the market varies in relation with, among other factors,
expected growth of earnings, expected stability of earnings,
expected inflation, and yields of competing investments. For
example, when US treasury bonds yield high returns, investors pay less for a given earnings per share and
P/E's fall.https://store.theartofservice.com/the-earnings-per-share-toolkit.html
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