what is dividend per share dps 
dividend per share dps is the sum of declared dividends issued by a company for every ordinary share outstanding the figure is calculated by dividing the total dividends paid out by a business including interim dividends over a period of time usually a year by the number of outstanding ordinary shares issued a company s dps is often derived using the dividend paid in the most recent quarter which is also used to calculate the dividend yield understanding dividend per share dps dps is an important metric to investors because the amount a firm pays out in dividends directly translates to income for the shareholder it is the most straightforward figure an investor can use to calculate their dividend payments from owning shares of a stock over time a consistent increase in dps over time can also give investors confidence that the company s management believes that its earnings growth can be sustained dps d sd s where d sum of dividends over a period usually a quarter or year sd special one time dividends in the period s ordinary shares outstanding for the period begin aligned text dps frac text d text sd text s textbf where text d text sum of dividends over a period usually text a quarter or year text sd text special one time dividends in the period text s text ordinary shares outstanding for the period end aligned dps sd sd where d sum of dividends over a period usuallya quarter or year sd special one time dividends in the periods ordinary shares outstanding for the period dividends over the entire year not including any special dividends must be added together for a proper calculation of dps including interim dividends special dividends are dividends that are only expected to be issued once and are therefore not included interim dividends are dividends distributed to shareholders that have been declared and paid before a company has determined its annual earnings if a company has issued common shares during the calculation period the total number of ordinary shares outstanding is generally calculated using the weighted average of shares over the reporting period which is the same figure used for earnings per share eps for example assume abc company paid a total of 237 000 in dividends over the last year during which there was a special one time dividend totaling 59 250 abc has 2 million shares outstanding so its dps is 237 000 59 250 2 000 000 0 09 per share special considerationsdps is related to several financial metrics that take into account a firm s dividend payments such as the payout ratio and retention ratio given the definition of payout ratio as the proportion of earnings paid out as dividends to shareholders dps can be calculated by multiplying a firm s payout ratio by its earnings per share a company s eps equal to net income divided by the number of outstanding shares is often easily accessible via the firm s income statement the retention ratio meanwhile refers to the opposite of the payout ratio as it instead measures the proportion of a firm s earnings retained and therefore not paid out as dividends the idea that the intrinsic value of a stock can be estimated by its future dividends or the value of the cash flows the stock will generate in the future makes up the basis of the dividend discount model the model typically takes into account the most recent dps for its calculation dividend per share examplesincreasing dps is a good way for a company to signal strong performance to its shareholders for this reason many companies that pay a dividend focus on adding to their dps so established dividend paying corporations tend to boast steady dps growth coca cola for example has paid a quarterly dividend since 1920 and has consistently increased annual dps since at least 1996 adjusting for stock splits 1similarly walmart has upped its annual cash dividend each year since it first declared a 0 05 dividend payout in march 1974 since 2015 the retail giant has added at least 4 cents each year to its dividend per share which was raised to 2 08 for walmart s fy 2019 2