CELG vs. GILD - earnings yield per share

After getting the idea here, I added an “earnings yield per share” column to my stock holdings spreadsheet, and I was just looking that over.

I decided to sell CMG (Chipotle) because their % was under the 30 year Treasury and I want to simplify my port a little bit.

But then I looked at the heavy EYPS? companies in my port. One of them is… Gilead!

GILD appears to have a beefy 7.16% earnings yield per share. When I look at CELG, it has a modest 2.73% (only slightly over the treasury rate).

I thought that was interesting. Some of the other bigs in my port are Wells Fargo and Apple…

I also think it’s interesting that AMBA’s % is larger than Facebook’s. However FB is much larger than AMBA.

I’m not sure how to interpret the numbers though…

Karen, What IS earnings yield per share?

Inversion of P/E.

So it is E/P.

Long Gild, short GiLD puts, long GILD calls

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Wait, haven’t you talked about it before?

The formula I have been using is – EPS / share price – so it fluctuates with share price.

Have I used the wrong terminology here?


I think that is usually just called “earnings yield”


This essentially tells you the rate at which the company earns money relative to it’s price. It’s the inverse of P/E ratio which is most commonly used on this board.

another similar variable one could use if they thought earnings were fudged is Free Cash Flow Yield



The potential cautions on Gilead are:

  • they are curing a disease and at some point the number of new patients requiring their main product may decrease

  • they are facing increasing competition from other large Pharma companies, and as a result lower pricing may result. PBIs are seeking to achieve price savings in the HEP C area.

That is not to say that GILD is not a good value, but one should be aware that the low p/e of the stock is due to these reasons.