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system
why is the stock market price for a share always higher than the earnings per share?
user
first, the earnings are per year, not per quarter.  why would you expect to get a 100% per year return on your money? the earnings can go one of two ways. they can be retained, reinvested in the company, or they can be distributed as a dividend. so, the 'return' on this share is just over 5%, which is competitive with the rate you'd get on fixed investments. it's higher, in fact, as there's the risk that comes with holding the stock.
assistant