Dividend Payout Ratio Calculator
Divide dividends paid by net income to see the payout ratio, the share of profit a company returns to shareholders as dividends.
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Enter dividends paid and net income to see the ratio.
Worked example
With these example inputs:
- Dividends paid$2,000,000
- Net income$5,000,000
Payout ratio: 40.0%
- The remaining share60.0%
- If the first figure were 10% higher44.0%
Frequently asked questions
What is the payout ratio?
It is the percentage of net income paid out as dividends. The rest, the retention ratio, is reinvested in the business.
What is a sustainable payout ratio?
It varies by sector. Mature firms often pay out more, while growth companies retain most earnings. A ratio above 100% means paying more than is earned.