Equity / Valuation Metric

Earnings Yield

Definition

The reciprocal of the P/E ratio, expressing earnings as a percentage of share price. Useful for comparing stocks to bonds and assessing relative valuation.

Formula / Rules
EPS / Share Price × 100
Example
$5 EPS on a $100 stock equals 5% earnings yield.
Related Terms
Dividend Yield Free Cash Flow Yield Price-to-Earnings Ratio (P/E Ratio)
Frequently Asked Question
What is Earnings Yield?
Earnings Yield is the inverse of the P/E ratio, showing earnings as a percentage of the stock price. Investors use it to compare equity returns to bond yields.
APA Citation
Clark, R. (2025). Earnings Yield. VixShield Trading Glossary. Retrieved from https://www.vixshield.com/glossary/earnings-yield
RC
Russell Clark, FNP-C
Author of SPX Mastery series · Founder of VixShield
Last updated:  ·  Source: VixShield Trading Glossary — From SPX Mastery by Russell Clark
⚠️ Not financial advice. This definition is educational content from the SPX Mastery book series by Russell Clark (VixShield). Past performance is not indicative of future results. Trading options involves substantial risk of loss and is not appropriate for all investors. Always paper trade before risking real capital.