The ratio of
earnings per share , after allowing for tax and
interest payments on fixed interest debt, to the current share price. The inverse of the
price/earnings ratio . It is the total twelve months
earnings divided by number of
outstanding shares, divided by the recent price, multiplied by 100. The end result is shown in percentage. We often look at earning yields because it avoids the problem of zero earnings in the denominator of the price/earning ratio.