Calculating your earnings yield is straightforward once you know the Earnings Yield formula and what each input means. This guide explains the method in plain language, walks through a manual calculation, and gives worked examples you can follow — then you can do it instantly with the Earnings Yield Calculator.
What is Earnings Yield?
The Earnings Yield calculation tells you your earnings yield from a few simple inputs. The figure you are solving for here is the earnings yield, expressed in percent.
The Earnings Yield formula
The core formula is:
Earnings yield = Earnings per share ÷ Share price × 100Here is what each input means:
- Earnings per share — a money amount. Example: ₹20.
- Share price — a money amount. Example: ₹400.
How to calculate it step by step
- Write down the earnings per share (for example, ₹20).
- Write down the share price (for example, ₹400).
- Apply the formula above to get your earnings yield.
- Double-check the result with the Earnings Yield Calculator.
Worked examples
Example 1
| Input / Output | Value |
|---|---|
| Earnings per share | ₹20 |
| Share price | ₹400 |
| Earnings yield | 5.0000% |
With earnings per share of ₹20 and share price of ₹400, the earnings yield works out to 5.0000%.
Example 2
With earnings per share of ₹40 and share price of ₹400, the earnings yield works out to 10.0000%.
| Result | Value |
|---|---|
| Earnings yield | 10.0000% |
Example 3
With earnings per share of ₹10 and share price of ₹400, the earnings yield works out to 2.5000%.
| Result | Value |
|---|---|
| Earnings yield | 2.5000% |
Tips for an accurate result
- Keep your units consistent — mixing, say, months with years or grams with kilograms is the most common source of error.
- Round only at the very end. Rounding inputs early can shift the final answer noticeably.
- Re-run the numbers whenever an input changes, rather than estimating from an old result.
- Annual rates must be converted to the period you are calculating for (for example, divide an annual rate by 12 for a monthly figure).
Prefer not to do the maths by hand? — the Earnings Yield Calculator does it instantly, for free, with the formula and a worked example built in.
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