EPS growth

EPS growth measures how much a company's earnings per share expanded or contracted compared to a prior period, usually the same quarter or year one year earlier.

The formula is:

EPS growth can differ from net income growth because EPS also depends on the share count. A company can grow net income by 10% but grow EPS faster than that if it's also buying back shares and shrinking the share count, or slower than that if it's issuing new shares that dilute existing holders. Because of this, EPS growth is often a better read on what a shareholder experiences than net income growth alone, since it accounts for how that profit is divided among the shares outstanding.