Dividend Payout Ratio Calculator
If you want to evaluate how much a company is efficient to earn its current dividend level, then this dividend payout ratio calculator is made for you.
In finance, the dividend payout ratio is an indicator used to determine the value of the net income paid to stockholders in the dividend's term. The result of the dividend payout ratio is narrated in percentages. If the value is near 100%, it indicates that the company has paid all of its net profit as dividends. The near 0% values indicate the company has paid little dividend from its net earnings. According to financial investors, a good dividend payout ratio is between 35% to 55%.
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Formula of Dividend Payout Ratio Calculator
To instantly calculate the dividend payout ratio, you can use the calculator, or to find it manually, you can use the formula listed below:
Dividend payout ratio = Total dividends / Net income
Note:
To calculate pre and post-money valuation, you can use our Pre And Post-Money Valuation Calculator.
Examples
For more prices understanding of a concept, let us have a dividend payout ratio example below:
Suppose a company has many investors and, with time, its stocks are increasing. According to a financial report, the company's net income was $16,273 million, and the total dividend paid by the company was $8,043 million. Calculate the Dividend payout ratio of a company.
Given data
Total dividends = $8,043 million
Net income = $16,273 million
To Find
Dividend payout ratio = ?
Solution
By using the formula listed below, we will find the value of the dividend payout ratio:
Dividend payout ratio = Total dividends / Net income
Putting values in the formula:
Dividend payout ratio = 8,043 million / 16,273 million = 0.49425 * 100
Dividend payout ratio = 49.425%
How to use the Dividend Payout, Ratio Calculator?
The steps to use the dividend payout ratio calculator are as follows:
Step 1: Enter the total dividend value in the first required input.
Step 2: Enter the net income value in the second required input.
Step 3: The calculator will automatically display an answer on the screen.
Calculator use
If you're searching for a calculator that helps you find the current dividend level that the company earns, you can use our dividend payout ratio calculator.
