plow back

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Plow back

To reinvest earnings in a business rather than pay out them out as dividends. Common practice in high-growth companies.

Plow Back

To reinvest a company's earnings into its operations. A high growth company often plows back the majority of its earnings rather than pays out dividends in order to maintain its high growth rate. On the other hand, established companies tend to plow back very little, unless they are attempting to corner or create a new market. The plowback ratio tells investors the rate at which companies do this.

plow back

To reinvest earnings in additional income-producing assets. Firms that plow back earnings rather than paying the earnings in dividends tend to experience more rapid increases in earnings per share.
References in periodicals archive ?
Because of the intensity of management made possible to a significant degree by the plowback funds, by 1970 the non declining even-flow allowable cut level for the O&C lands - that is, the amount deemed available for harvest each year without causing reductions in future harvests - had risen to 1.
SGR represents the sustainable growth rate, calculated as the product of return on equity and plowback ratio.
First, the human capital was bound to the firm by the plowback provisions of the partnership agreement.
Total plowback of the Majors' cash flow this year comes to only 40%; addition of divestiture proceeds brings the ratio down to a mere 34%.
The companies' plowback percentage, total upstream spending as a percentage of netback (revenues less production costs), increased to 170% in 2010.
The 50 companies' plowback percentage (total capital expenditures as a percentage of netback or revenues less production costs) decreased in 2009 to 85%.
E&P companies have been making significant investments in their oil and gas operations, with a plowback percentage of 102% during 2006-2008 and 91% over the five-year period," said Charles Swanson, Houston office managing partner for Ernst & Young LLP.