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Dividend payout ratio

   Also found in: Acronyms 0.09 sec.
Dividend payout ratio
Percentage of earnings paid out as dividends.

dividend payout ratio

Dividend payout ratio. You can calculate a dividend payout ratio by dividing the dividend a company pays per share by the company's earnings per share. The normal range is 25% to 50% of earnings, though the average is higher in some sectors of the economy than in others.

Some analysts think that an unusually high ratio may indicate that a company is in financial trouble but doesn't want to alarm shareholders by reducing its dividend.



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The Company bases its decisions on dividends on a comprehensive assessment of earnings trends, the level of internal reserves needed for future growth and the dividend payout ratio.
For the first quarter 2003, the company's dividend payout ratio on FFO was 68.
This healthy dividend increase reflects the confidence of our Board of Directors in our ability to generate strong cash flow that supports our objective of a 35 to 45 percent dividend payout ratio in addition to funding the current and future growth initiatives of Bemis' operations.
 
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