Earnings per share, or EPS, is a financial metric that indicates a company's profitability on a per-share basis. It is calculated by dividing the net income of the company by the number of outstanding shares of common stock. A higher EPS suggests that a company is generating more profit for each share, which can be an attractive factor for investors. EPS is often used to compare the financial performance of companies within the same industry. Investors look at EPS trends over time to assess a company's growth potential and overall financial health. It is an important indicator for making informed investment decisions.