What does a negative (-) EPS mean? How would you calculate value of stock if its at $8.5/share?

Question

What does a negative EPS means? How would one read that number. And then knowing the stocks current value per share is $8.5, how would you calculate how much the stock is over or underpriced if the EPS is -5.5?

Answer 1

Why invest in a company with negative earnings? Unless of course those negatives will turn into accelerating positives. But as a standard rule, companies with negative earnings should be traded, and when trading who really cares about the value of the company?

Answer 2

Negative EPS means that the company lost money for that period.  The value of the stock is determined by the market.