Financial Statement Analysis
 Ratio Analysis of Financial Statements (Formula, Types, Excel)
 Ratio Analysis
 Liquidity Ratios
 Turnover Ratios
 Profitability Ratios
 Profit Margin
 Gross Profit Margin Formula
 Operating Profit Margin Formula
 Net Profit Margin Formula
 EBIDTA Margin
 Earnings Per Share
 Basic EPS
 Diluted EPS
 Basic EPS vs Diluted EPS
 Return on Equity (ROE)
 Return on Capital Employed (ROCE)
 Return on Invested Capital (ROIC)
 Return on Total Assets (ROA)
 Return on Average Capital Employed
 Capital employed Employed
 Return on Average Assets (ROAA)
 Return on Average Equity (ROAE)
 Return on Assets Formula
 Return on Equity Formula
 DuPont Formula
 Net Interest Margin Formula
 Earnings Per Share Formula
 Diluted EPS Formula
 Contribution Margin Formula
 Revenue Per Employee Ratio
 Operating Leverage
 EBIT vs EBITDA
 EBITDAR
 Capital Gains Yield
 Tax Equivalent Yield
 LTM Revenue
 Operating Expense Ratio Formula
 Overhead Ratio Formula
 Capacity Utilization Rate Formula
 Total Expense Ratio Formula
 Efficiency Ratios
 Dividend Ratios
 Debt Ratios
 Debt to Equity Ratio
 Debt Coverage Ratio
 Debt Ratio
 Debt to Income Ratio Formula (DTI)
 Capital Gearing Ratio
 Capitalization Ratio
 Interest Coverage Ratio
 Times Interest Earned Ratio
 Debt Service Coverage Ratio (DSCR)
 Financial Leverage Ratio
 Net Debt Formula
 Leverage Ratios
 Operating Leverage vs Financial Leverage
 Current Yield
 Debt Yield Ratio
Dividends per Share Formula
Before an investor calculates the dividend yield – stock, she needs to know dividend per share which we also call DPS.
Here’s the formula for dividends per share (DPS) –
Since this calculation is done after the dividend is being paid, an investor will only get to know the past records. For example, if an investor wants to know the DPS of a company, he will look at the data of the latest year and then follow along.
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Example of Dividends per Share Formula
Let’s take a practical example to illustrate dividends per share formula.
Honey Bee Company has paid annual dividends of $20,000. The beginning outstanding stock was 4000 and the ending outstanding stock was 7000. Calculate DPS of Honey Bee Company.
In this example, we can go for simple average to find out the average outstanding shares.
 The beginning outstanding stock was 4000 and ending was 7000.
 Using the simple average, we get the average outstanding stock as = (4000 + 7000) / 2 = 11,000 / 2 = 5500.
 The annual dividends paid were $20,000.
Using the DPS formula, we get –
 DPS Formula = Annual Dividends / Number of Shares = $20,000 / 5500 = $3.64 per share.
Now, if we want to find out the dividend yield of the company, we can do so. We need to keep in mind that a lower DPS doesn’t mean that the company has no growth potential. We need to know the dividend yield and other financial measures to ensure whether the company has enough growth potential or not.
Explanation of Dividends per Share Formula
In this formula for Dividends per Share, the most important part is the “number of shares”. You can simply take the record of the beginning shares and the ending shares, and calculate the simple average of outstanding shares. Or else, you can go for weighted average.
You would see that in calculating earnings per share also we take the weighted average of outstanding shares. But the basic difference between the dividends per share and earnings per share is what we put in the numerator.
In DPS, we take annual dividends; and in the case of earnings per share, we use net income. The use of the weighted average method is true for those companies that pay dividend for the existing shares in January and issue new shares in December. You get the idea. Depending on an approach of a company, we may choose the calculation method.
Use of DPS Formula
Any investor would look at different stocks to find out in which she would invest in.
For that, the investor looks at different ratios. Only DPS may not provide the overall outlook of the company; but if an investor can look at different financial ratios along with dividend payout ratio, dividend yield, and DPS; she would have a solid understanding of the company.
If an investor sees that the dividend payout ratio of a company is lower; that means the company is reinvesting more to increase the value of the company. Before an investor ever decides to invest; she needs to look at all the measures and find out a holistic view of company’s financial affairs.
As we see from above, Colgate has been consistently paying dividends over the years, however, companies like Amazon and Google haven’t paid any dividends yet.
Dividends per Share Calculator
You can use the following Dividends per Share Calculator
Annual Dividends  
Number of Shares  
Dividend per Share Formula =  
Dividend per Share Formula = 


Dividends per Share in Excel (with excel template)
Let us now do the same example above in Excel.
This is very simple. You need to find the average outstanding shares using simple average formula. And then You need to provide the two inputs of Annual Dividends and Number of Shares.
You can easily calculate the ratio in the template provided.
First,we will go for simple average to find out the average outstanding shares.
Now, we will find out the dividends per share of Honey Bee Company.
You can download this DPS template here – Dividends per Share Excel Template
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This has been a guide to Dividends Per Share, Formula for dividends per Share, uses, and examples. Here we also provide you with Dividends per share calculator along with excel template. You may also learn more about financial analysis from the following set of articles
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