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Home/ Finance/ On an Equity's Dividend Yield and Price-Earnings Ratio

On an Equity's Dividend Yield and Price-Earnings Ratio

Paul Kotschy

7 October 2010

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An equity investor 1 purchases shares in a publicly listed company. In return, the investor usually receives dividend payments from the company. And, the share price of the company hopefully rises over time as a result of the company's increase in earnings. The simple analysis here expresses the investor's change in relative monetary net worth as a function of the company's dividend yield, its earnings per share, and its price-per-unit-earnings ratio.


  1. 1 I declare this to be my own work, entirely. In particular, no AI was used in any research, analysis, synthesis, writing, nor typesetting of this work. In short, AI was not recruited at any time in this work. Errors and inaccuracies are therefore proudly my own.

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