BUSINESS FINANCE

5 The MPS is the price at which a new share can be bought. EPS is the annual income from each share. Hence, P/E ratio indicates the number of years it will take to recover MPS from the annual EPS of the firm. As will be observed in the earnings yield (EY) the price earnings ratio is a reciprocal of EY. Dividend payout ratio = DPS x 100. EPS ................
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