A P/E of 10× is an earnings yield of 10%. Expressed this way, a share's earnings can be compared directly with bond yields or bank deposit rates.
Formula
Earnings yield = EPS ÷ share price × 100
Glossary
Earnings yield is earnings per share divided by the share price, the inverse of the P/E ratio, expressed as a percentage.
A P/E of 10× is an earnings yield of 10%. Expressed this way, a share's earnings can be compared directly with bond yields or bank deposit rates.
Formula
Earnings yield = EPS ÷ share price × 100