Price to Earnings (P/E) Ratio and Earnings Per Share (EPS) Explained

This video provides a basic introduction into the price to earnings ratio and earnings per share value. It explains how to calculate the P/E ratio using two simple formulas and how to calculate the EPS value using the earnings of a company minus any preferred dividends divided by the shares outstanding. The P/E ratio can be calculated by dividing the price of the stock by the EPS value. It can also be calculated by dividing the market capitalization of the company by the total earnings.
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[@TheOrganicChemistryTutor]

Final Exams and Video Playlists: www.video-tutor.net/

[@essayprometheus]

bro literally yesterday i was watching your calculus videos to prepare for next semester. and now today, youre helping me learn stocks. what cant you do?

[@SQU1NTZ]

Holy crap, I watched your video last week for Organic Chemistry homework and now I'm watching ur P/E video as I'm learning stocks.
When I started the video and heard your voice, I thought I clicked on a Chemistry video LOL

[@Juniorrs.exe-]

I love how this channel does everything to do with numbers

[@tonyvo8285]

Be careful Tesla p.e very high

[@Juniorrs.exe-]

@@tonyvo8285 ?

[@tonyvo8285]

shoya eps .39 per share PE 1,094 very high

[@tonyvo8285]

Microsoft better than Apple

[@tonyvo8285]

Microsoft 36.4

[@aaranchauhan9997]

You do accounting and finance too!? This channel has everything

[@michaeldacosta7504]

Excellent video! The exercises at the end were a great decision for solidifying the concepts

[@bpdoc3871]

You should definitely do more finance videos. Also, they're really hard to find amongst all the other videos.

[@apopj5322]

omg the organic chemistry tutor knows finance

[@laminbsanyang2494]

This man is a genius. His wisdom is large

[@srush8670]

Beautifully explained. Thanks a lot.

[@joetrujillo6868]

Thank you. This is what I was looking for.

[@DRMath]

Well explained with examples. I really like the way you set up the study material. Thanks for sharing the knowledge with others!!
Peace ✌️

[@g00gle-]

Agree totally combined with the examples perfect.

[@alfredojtee]

Brilliant...one of the BEST videos I've watched.

[@JoelGKSAvlogsTV]

Will explained regarding how to calculate the absolute the rate, thanks for sharing

[@shahana5064]

Thank you so much! Very instructive.

[@jaehus1971]

Excellent video !!! Thank you

[@MysticaReych]

You're awesome!! Thank you, so informative. Made 20 minutes feel like 5 minutes! :D

[@limphokabi9903]

This absolutely amazing: price to earnings and Earnings per share

[@thoughtfulziaul]

This is awesome, firet time I understand what P/E is

[@Hellnation13]

Thank you for your time.

[@MundoTheTowo]

This video was very helpful and straightforward

[@channaholidays7198]

very good analysing thanks.

[@jamestroy8283]

Thank you for this lesson It is most appreciated

[@Mexzshorts5.55]

Myaannnnnn
I don't have any words to thank you for this outstanding explanation thank you sooo much. :)
(sorry for my bad English)

[@mohdridhwan7183]

Thank you. learn PE ratio very clearly here

[@happysaving4042]

The video full of information.

[@shana5859]

Nice video with examples

[@medmuslimah5972]

Your consistency is just
.....wow !!!

[@sanchez5963]

Study GF was about to say

[@wp8320]

Thank you so much. Could never understand this before

[@royalfocus618]

Best video I could find!!!!!

[@DystopicEdits]

This guys know everything

[@nuraina.ann7]

Thank you bro for the explanation, ❤❤

[@olimov9906]

You are the best. thanks

[@emilianocislaghi7205]

Really good

[@taimyrmelanie4062]

Great vidéo, thank you

[@sanjipthakur6222]

Outstanding

[@MicahLuciani]

Thank you!

[@MJ-ck2gs]

i love you so much 🥺❤❤❤❤❤❤thanks

[@reviewithme9913]

Easy teaching = Easy learning

[@SETUBANDHII214II]

What do you mean when you say outstanding shares?

[@nolufefemxotshana5656]

Wow thank you so much ❤

[@humphreylinda2565]

First time viewer ,loved it...quick question, how do calculate the average 5 year of earnings of a stock ?

[@raymondstewart5787]

Awesome job 👍🏽👍🏽👍🏽👍🏽👍🏽

[@harrywotter7120]

what is another name for outstanding shares

[@saira_0140]

thank you!!

[@tristlun]

best video

[@Shabeerxp]

Hai dear can you tell, these earnings here we using is yeraly earnings or quarterly or monthly??

[@MundoTheTowo]

Liked and subscribed ❤

[@geraldomedrano5558]

Where do you get your information from? Hope you don't take my question the wrong way, but I am genuinely interested where youre learning this from since I'm interested in learning more about finance.

[@OrganicAlumination]

Im just trying to figure out where preferred and common stocks come into play in the equation... like net income minus preferred dividends,but what about the shareprices? because the number of shares is different then the prices.

[@joenguyen1733]

Hi. Thanks for the video and explanation. For the first time I know what are P/E and EPS. But I see 1 thing wrong in this video is: P/E ratio doesn't have dollar unit. In video you calculated P/E is $5.

[@joenguyen1733]

I mean $7

[@khalidhabbash9725]

Your voice reminds me of my final exams

[@xxyoutube6623]

What is a preferred dividend??

[@tudutapas3146]

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[@paulsebastianvaldenarro7648]

Which net income? Quarterly Report? Semi Annual? Or Annual Financial Report?

[@sonyabadass]

Is earnings in EPS, anualise or in each quarter (3 months earnings) ?

[@FactFlix3]

annual

[@alexandrosrothenberg8781]

Hi.Do you offer crypto value or analyze training?

[@user-wo8hf1qd3z]

So if u are given proposed dividend and not preferred dividend will u subtract it from your net income

[@seuna1631]

where and how do you determine shares outstanding

[@francescapetrella2198]

how would i calculate the EPS of this David’s Magic Stores has an operating profit of $230,000. Interest expense for the year was $33,000; preferred dividends paid were $29,000; and common dividends paid were $45,000. The tax was $51,600. David’s Magic Stores has 25,000 shares of common stock outstanding.
im so stuck

[@cust0mEditi0n]

EBITDA-interest-tax-preferred div, dividedby shares outstanding =116400/25000= ≈4.656
230,000-33000-51600= 145400-116400/25000
Hope this helps

[@francescapetrella2198]

@@cust0mEditi0n thank you!

[@sunilthakur5251]

hello I am pretty sure that your comment that based on higher EPS company A stock is better deal is incorrect hypothesis. Both companies have same Net Income so both are identical in earnings. one company has just issued more stock so the stock price should be 5x difference and P/E should be the same.

[@jordanporter4518]

Could you use a real world example? Whenever i use this formula on real stocks the numbers dont add up at all.

[@sonyabadass]

What is outstanding shares? the whole public shares?

[@junaidakhtar3407]

Total issued shares

[@sonyabadass]

@@junaidakhtar3407 what is issued?

[@nocontentjustads3878]

@@sonyabadass outstanding shares is the combination of shares traded in the open market(float shares) and restricted shares which is owned typically by executives within the company.

[@kingtigercrownestate9102]

A company with a lower E.P.S. may not necessarily be doing bad they just might need to decrease shares outstanding which is why companies do stock buybacks... the company may be doing great on earnings but in order to immediately increase E.P.S. to each shareholder or potential shareholder they may just need to decrease too many perceived shares outstanding while working to still increase earnings more and more overtime just as long as the E.P.S. is not actually negative a person has to do total due diligence on a company that they might want to hold shares of because all is NOT equal between to companies there WILL be differences to compare between two balance sheets even in the same industry and everything has to be considered. Ex comparing Walmart to Target Amazon to eBay or McDonald's to Chipotle same industry but two different companies with two individual different balance sheets.

[@Arylineisashadeofyellow]

I was trying to set up my tv and found this

[@stoicaalex90]

The bigger eps the better, correct?

[@YamiDuez]

How tf did I find this from a QR code coming from a tv😂

[@jaidyndearden5515]

I don't understand how shares outstanding determines how the company is performing

[@matchaisasoup]

Ah yes, It’s big brain time.
(I’m a 7th grader)

[@jds189]

I'm in kindergarten I win

[@baljeet7217]

@@jds189 im a fetus that is investing in the share market from a womb

[@jds189]

@@baljeet7217 I bow to your greatness

[@andrewstein8397]

I stopped at the first ad, but that denominator isn’t right. It should be weighted average shares outstanding, which can be a vastly different number for growth companies. Not surprising that a chemistry tutor wouldn’t understand per-share ratios, but scary to see people say they’re “learning stocks” from these videos.

[@jaguarcheatcode]

Earnins

[@tariqaltelaihi8800]

ا

[@iiainiii]

Dawg what can’t you do?😭😭

[@martymcfly5423]

It shouldnt be called Price-to-Earnings-Ratio. It should be called Stock-Price-to-Earnings-per-Stock-Ratio 🤓