Earnings Per Share

Definition:  EPS is the net income available to common shareholders of the company divided by the number of shares outstanding.

Make sure the company is not trying to manipulate their EPS numbers to make it look like they are more profitable. Also, look at the growth in EPS over the past several quarters / years to understand how volatile their EPS is, and to see if they are an underachiever or an overachiever. In other words, have they consistently beaten expectations or are they constantly restating and lowering their forecasts?

For eg:  If the total income is $ 1 million , and total shares is 1 million then EPS is $ 1 million/1 million shares = $1.

EXERCISE

Which one of the below is good share to buy based on EPS?

Company A:  EPS - $1, market price $100
Company B:  EPS - $2, market price $150

Share Market

Here Are 18 Brilliant Quotes From The Greatest Investor Of All Time

 

The  Oracle of Omaha, Warren Buffett born on August 30, 1930 (82 years old).
He may be one of the wealthiest people in the world.  But he's also known as the billionaire next door.  He comes off as humble and sometimes uses self-deprecating humor.  Maybe it has something to do with the fact that he's lived in Omaha, Nebraska for most of his life.

Buffett also uses extremely easy-to-understand language when referring to business and investments.

Many of his most thoughtful quotes are found in his annual letters to Berkshire Hathaway shareholders, which are must reads.  But some of his gems come from random interviews, speeches, and op-ed pieces.

We compiled a few of the best quotes from the Oracle of Omaha. If we've missed any of your favorites, let us know in the comments.