请问earning yield为负数，是比较绝对值大小还是负数正常比大小？怎么算higher呢？

问题如下：

An analyst plans to use P/E and the method of comparables as a basis for recommending purchasing shares of one of two peer-group companies in the business of manufacturing personal digital assistants. Neither company has been profitable to date, and neither is expected to have positive EPS over the next year. Data on the companies’ prices, trailing EPS, and expected growth rates in sales (five-year compounded rates) are given in the following table:

Unfortunately, because the earnings for both companies have been negative, their P/Es are not meaningful.

Which stock the analyst should recommend?

选项：

A.

Hand

B.

Somersault

C.

Cannot tell based on information given

解释：

Hand has an E/P of –0.100, and Somersault has an E/P of –0.125. A higher earnings yield has an interpretation that is similar to that of a lower P/E, so Hand appears to be relatively undervalued. The difference in earnings yield cannot be explained by differences in sales growth forecasts. In fact, Hand has a higher expected sales growth rate than Somersault. Therefore, the analyst should recommend Hand.