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earning power

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Financial Dictionary

earning power

  1. The earnings that an asset could produce under optimal conditions. For example, AT&T may currently be earning $2.50 per share; however, under optimal conditions each share could have earnings of $3.75.

  2. The expected yield on a security.


Wall Street Words: An A to Z Guide to Investment Terms by David L. Scott.
Copyright © 2003. Published by Houghton Mifflin.
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