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Re: justanotherfigment post# 24454

Monday, 08/19/2013 9:33:51 PM

Monday, August 19, 2013 9:33:51 PM

Post# of 33394
If net income doubles and shares issued doubles, theoretically, based on the same PE Ratio is constant , then Price per Share should not change.

Example :

Net income = 1,000,000
Shares OS = 1,000,000

EPS = $1.00
PE ratio = 15
Stock Price = $15.00 per share


Net Income = 2,000,000 double
Shares OS = 2,000,000 double

EPS = $1.00 same
PE Ratio = 15
Stock Price = $15.00 per share

Circ shares increased about 25% but Net Income went from negative to positive, let's just say 100%, 4 times. Circ should go up, right!