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Earnings Yield: Definition, How to Calculate It, Example

By Catherine BrockUpdated Jan 11, 2025 at 1:45 PM

Key Points

  • Earnings yields are calculated as earnings per share divided by share price.
  • Earnings yield are best used in comparisons; a higher earnings yield is generally more favorable.
  • Earnings yields can be an alternative to the P/E ratio for companies with negative earnings.

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