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Financial Analysis




Dividend Payout Ratio


A financial ratio that relates cash dividends to profits. That is:

Dividend Payout Ratio

For example, if a company intends to distribute $30,000 in cash dividends out of $100,000 it made in profits, thus its dividend payout ratio is:

Dividend payout ratio= 30,000/ 100,000 = 30%.

This means for every dollar of net income the company distributes 30 cents in dividends.



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The financial analysis of companies is essentially undertaken with the aim to assess their performance in light of their objectives and strategies ...
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