The dividend per share calculator is a simple calculator that accurately and readily calculates the metric.

Dividend per share is an absolute figure that presents how much dividend a corporation has decided to pay to the shareholder for each share they hold.

There are two formulae that can be used for calculating the dividend per share.

**Formula 1:**

Dividend Per Share = Total Dividend / No. of Common Shares Outstanding

**Formula 2:**

Dividend Per Share = Total Dividend / Weighted Average Number of Common Shares Outstanding

We noticed that the difference between the two formula is due to the no. of outstanding shares, i.e., the numerator.

The first formula is intended for the investors to know how much total dividend they will receive depending on the holding of the investor. Therefore, here the outstanding no. of common shares is the no. of shares outstanding as on the record date.

The second formula is useful for the analysts to know the effective dividend per share.

## About the Calculator / Features

The dividend per share calculator accurately calculates the dividend per share by inputting the total dividend and no. of outstanding shares.

## Calculator

## How to Calculate using a Calculator?

For using the calculator for calculating DPS, one has to find out the following figures.

Total Dividend: It is the total dividend that the corporation has declared and decided to pay. This figure is available in the annual report of a corporation.

No. of Outstanding Shares: This is the number of shares that can be used depending on the purpose. As explained above, outstanding no. of shares as on record date or weighted average no. of outstanding shares can be utilized.

## Example

Let’s take an example to understand the formula and calculator.

For instance, assume a company has allocated and declared a total dividend of $2,500,000, and it has an outstanding no. of shares as 1,000,000. The dividend per share would be equal to $2.5 per share (2,500,000/1,000,000).

This metric is a very important tool for various purposes. The metric is useful in comparing 2 firms in the same business. Past year trends of the DPS speak a lot about the dividend policy of the corporation. Apart from this, there are various important models that use dividend per share for arriving at the valuation of a company.

## Cautions

One should be careful in using the outstanding no. of equity shares. As a result of using the weighted average, the chances of errors are more. One should be even more careful with complex calculations.