Posted in Finance, Accounting and Economics Terms, Total Reads: 242
Definition: Sales Per Share
Sale per share is a method of understanding the performance of a company by calculating the amount of revenue or sale that a company generates for each share the company has. As a measure of effectiveness a defined time period is considered, mostly a financial year or a 12 month block.
As number of shares can fluctuate, it is calculated by taking the weighted average of the shares outstanding in that fiscal year. If the ratio is high, it clearly indicates the good performance of the company as it highlights the fact that the company is able to generate higher revenues for every share.
Sales Per Share = (Total Sales/Revenue)/(Average Share outstanding)
Some of the companies with fastest increasing sales/share are Apple Inc, Goldman Sachs Group Inc, Facebook etc.
In certain cases, sale per share is also referred as revenue per share.