Price Per Share Calculator

Price Per Share Formula:

\[ PPS = \frac{Total\ Value}{Shares\ Outstanding} \]

Price Per Share (PPS):

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1. What is Price Per Share?

Price Per Share (PPS) is a financial metric that represents the market value of a single share of a company's stock. It is calculated by dividing the company's total market capitalization by the number of outstanding shares.

2. How Does the Calculator Work?

The calculator uses the Price Per Share formula:

\[ PPS = \frac{Total\ Value}{Shares\ Outstanding} \]

Where:

$ PPS $ — Price Per Share ($ per share)
$ Total\ Value $ — Market Capitalization ($)
$ Shares\ Outstanding $ — Total number of shares (count)

Explanation: This calculation provides the theoretical value of each individual share based on the company's total market valuation.

3. Importance of PPS Calculation

Details: Price Per Share is fundamental for investors to assess stock valuation, compare companies of different sizes, make investment decisions, and track stock performance over time.

4. Using the Calculator

Tips: Enter the total market capitalization in dollars and the number of outstanding shares. Both values must be positive numbers (total value > 0, shares ≥ 1).

5. Frequently Asked Questions (FAQ)

Q1: What is the difference between PPS and market cap?
A: Market cap represents the total company value, while PPS shows the value per individual share. PPS allows comparison between companies regardless of their size.

Q2: Why does PPS change frequently?
A: PPS changes with market conditions, company performance, investor sentiment, and overall economic factors that affect stock prices.

Q3: Is a higher PPS always better?
A: Not necessarily. A high PPS could indicate strong performance, but it could also mean the stock is overvalued. Investors should consider P/E ratios and other metrics.

Q4: How does stock split affect PPS?
A: Stock splits increase the number of shares outstanding, which decreases the PPS proportionally while keeping the total market cap unchanged.

Q5: Can PPS be used for all types of companies?
A: Yes, this calculation works for publicly traded companies. For private companies, similar calculations use estimated valuations and share counts.