Earnings yield

The inverse of P/E. Compare equities to bonds on the same yield scale.

P/E ratio (×)

10-year Treasury yield (%)

Earnings yield

5.00%

From P/E of 20×

Spread vs Treasury: +0.50 pp. Modest premium — typical late-cycle territory.

Formula

Earnings yield = 1 / P/E. Comparing it to a high-quality bond yield gives a quick read on whether you're being paid a meaningful equity premium for the extra risk.

Illustrative only. Calculator outputs assume constant inputs and ignore taxes, fees, inflation, and market volatility unless stated. For research and educational purposes only — not financial advice.