Difference between revisions of "Calculate the Dividend Payout Ratio"
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{{fa}}In finance, the dividend-payout ratio is a way of measuring the fraction of a company's earnings that are paid to investors in the form of dividends rather than being re-invested in the company in a given time period (usually one year). In general, companies with higher dividend-payout ratios tend to be older, more established companies that have already grown significantly, while companies with low payout ratios tend to be younger companies with high growth potential. To find a business's dividend-payout ratio for a given time period, use either the formula '''Dividends paid divided by Net income''' or '''Yearly dividends per share divided by Earnings per share'''. Those formulas are equivalent to each other. | {{fa}}In finance, the dividend-payout ratio is a way of measuring the fraction of a company's earnings that are paid to investors in the form of dividends rather than being re-invested in the company in a given time period (usually one year). In general, companies with higher dividend-payout ratios tend to be older, more established companies that have already grown significantly, while companies with low payout ratios tend to be younger companies with high growth potential. To find a business's dividend-payout ratio for a given time period, use either the formula '''Dividends paid divided by Net income''' or '''Yearly dividends per share divided by Earnings per share'''. Those formulas are equivalent to each other. | ||
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== Steps == | == Steps == | ||
