Stock Ratios Calculator

What is a Stock Ratios Calculator?

A Stock Ratios Calculator computes key financial metrics that investors use to evaluate a company's stock performance and valuation. By entering basic financial data such as net income, shares outstanding, stock price, and balance sheet figures, you can instantly calculate important ratios including Earnings Per Share (EPS), Price to Earnings (P/E) Ratio, Price to Sales (P/S) Ratio, Price to Book Value (P/BV) Ratio, and Dividend Payout Ratio. For related investing tools, try our Stock Average Calculator and Dividend Yield Calculator.

Key Stock Ratios Explained

• Earnings Per Share (EPS): Net income divided by total shares outstanding. EPS measures how much profit a company generates for each share of stock.
• Price to Earnings (P/E) Ratio: Stock price divided by EPS. The P/E ratio shows how much investors are willing to pay per dollar of earnings. A higher P/E may indicate growth expectations.
• Price to Sales (P/S) Ratio: Market capitalization divided by total revenue. The P/S ratio compares a company's stock price to its revenue, useful for evaluating companies that may not yet be profitable.
• Price to Book Value (P/BV) Ratio: Stock price divided by book value per share. The P/BV ratio compares market value to accounting value, helping identify undervalued stocks.
• Dividend Payout Ratio: Total dividends divided by net income, expressed as a percentage. This shows the proportion of earnings paid out as dividends to shareholders.

How to Use Financial Ratios for Stock Analysis

Financial ratios are powerful tools for comparing companies within the same industry and evaluating a stock's relative value. A low P/E ratio may suggest an undervalued stock, while a very high P/E could indicate overvaluation or high growth expectations. The P/S ratio is particularly useful for evaluating younger companies with high revenue growth but limited profitability. The P/BV ratio helps assess asset-heavy industries like banking and insurance.

Understanding Market Capitalization

Market capitalization (market cap) is the total value of a company's outstanding shares, calculated by multiplying the stock price by the total number of shares. It is automatically calculated when you enter the price per share and shares outstanding, but you can also override it manually if needed for your analysis.