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The earnings yield is an indication of how much return shareholders' investment in the company earned over the past 12 months. The higher the earnings yield is, the better.
As of today (2024-12-14), the stock price of Equity Commonwealth is $1.69. Equity Commonwealth's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Sep. 2024 was $0.39. Therefore, Equity Commonwealth's earnings yield of today is 23.08%.
The earnings yield does not consider the growth of the business. A better indicator of the attractiveness of an investment which takes growth into account is the Forward Rate of Return (Yacktman) %. Equity Commonwealth's Forward Rate of Return (Yacktman) % for the quarter that ended in Sep. 2024 was 0.00%. The Forward Rate of Return uses the normalized Free Cash Flow of the past seven years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
Earnings yield is the reciprocal of the P/E Ratio.
Equity Commonwealth's Earnings Yield for today is calculated as
Earnings Yield | = | Earnings per Share (Diluted) (TTM) | / | Share Price |
= | 0.390 | / | 1.69 | |
= | 23.08 % |
Equity Commonwealth's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Sep. 2024 adds up the quarterly data reported by the company within the most recent 12 months, which was $0.390 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
It can also be calculated from the numbers for the whole company:
Earnings Yield | = | Net Income | / | Market Cap |
The earnings in the calculation is the Trailing Twelve Months earnings.
Equity Commonwealth (NYSE:EQC) Earnings Yield % Explanation
If the P/E ratio is an indication of how many years it takes for the company to earn back the stock price shareholders pay to buy the shares, the earnings yield is an indication of how much return shareholders' investment in the company earned over the past 12 months. The higher the earnings yield is, the better.
If a company loses money, the earnings yield is negative. This gives a more straightforward indication that the company is losing money. This is an advantage of using earnings yield instead of the P/E ratio in valuation. For valuation purposes, the P/B Ratio and the P/S Ratio should be used for companies that are losing money.
Like the P/E ratio, the earnings yield can be used to compare investments in different industries. It can even be used to compare the attractiveness of different asset classes such as bonds and cash. Of course, the earnings yield should not be the only factor in deciding which asset classes to invest.
Also similar to the P/E ratio, the earnings yield does not consider the growth of the business. A growing company with the same earnings yield should be more attractive than a company that has the same earnings yield but does not grow.
A better indicator of the attractiveness of an investment which takes growth into account is the Forward Rate of Return (Yacktman) %.
Be Aware
Just like the P/E Ratio, non-recurring items such as selling part of the business, selling a previous investment, etc., can affect earnings yield dramatically. The earning yield is also a poor indication for cyclical companies. When a cyclical stock has a high earnings yield it is usually at the peak of its cycle.
Thank you for viewing the detailed overview of Equity Commonwealth's Earnings Yield % provided by GuruFocus.com. Please click on the following links to see related term pages.
Andrew Levy | officer: SVP & Chief Accounting Officer | C/O EQUITY COMMONWEALTH, TWO NORTH RIVERSIDE PLAZA, SUITE 2100, CHICAGO IL 60606 |
Orrin S Shifrin | officer: EVP, Gen. Counsel & Secretary | CWH MANAGEMENT LLC, 2 N RIVERSIDE PLAZA, SUITE 600, CHICAGO IL 60606 |
William H Griffiths | officer: SVP, CFO & Treasurer | C/O EQUITY COMMONWEALTH, TWO NORTH RIVERSIDE PLAZA, SUITE 2100, CHICAGO IL 60606 |
Ellen-blair Chube | director | 150 N. RIVERSIDE PLAZA, CHICAGO IL 60606 |
Gerald A Spector | director | C/O EQUITY RESIDENTIAL, TWO NORTH RIVERSIDE PLAZA, SUITE 400, CHICAGO IL 60606 |
Adam Scott Markman | officer: EVP, CFO & Treasurer | TWO NORTH RIVERSIDE PLAZA, SUITE 600, CHICAGO IL 60606 |
Lozier James Lloyd Jr | director | 4616 DORSET RD, DALLAS TX 75229 |
David Helfand | director, officer: President & CEO | C/O MANUFACTURED HOME COMMUNITIES INC, 2 N RIVERSIDE PLAZA #800, CHICAGO IL 60606 |
Jeffrey Douglas Brown | officer: SVP & Chief Accounting Officer | 3726 AVALON TRAIL, LEBANON OH 45036 |
David S Weinberg | officer: EVP & Chief Operating Officer | CWH MANAGEMENT LLC, TWO NORTH RIVERSIDE PLAZA, SUITE 600, CHICAGO IL 60606 |
Samuel Zell | director, other: Chairman of the Board | TWO N RIVERSIDE PLAZA, SUITE 600, CHICAGO IL 60606 |
Peter Linneman | director | 1696 N E MIAMI GARDENS DR, N MIAMI BEACH FL 33179 |
James A Star | director | |
James Scott Corl | director | C/O COHEN & STEERS, INC, 280 PARK AVENUE, NEW YORK NY 10017 |
Martin L Edelman | director | C/O PAUL HASTINGS JANOFSKY & WALKER LLP, 75 EAST 55TH STREET, NEW YORK NY 10022 |
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