Dados B3 › Glossary

Glossary

Earning yield

Yearly profit as a percentage of market value: the P/E turned upside down.

What it is

Yearly profit as a percentage of market value: the P/E turned upside down. Shown on the stocks pages.

How Dados B3 calculates it

the year's profit attributable to controlling shareholders ÷ market value. It is the inverse of the P/E.

Example

Illustrative example, with made-up numbers to keep the arithmetic easy: A P/E of 10 equals an earning yield of 1 ÷ 10 = 10%: one year of profit equals 10% of market value.

What to watch for when reading it

• It is not money reaching the shareholder: profit can stay in the company or be one-off.
• It is handy for comparing with fixed-income rates, knowing they are different things.

See also

• P/E (price to earnings)

Methodology · All indicators

Educational content to understand what each number means. It is not a recommendation to buy or sell.