Dividend Payout Ratio

The payout ratio is the share of a company's earnings paid out as dividends rather than kept for reinvestment.

Part of the Growth & Capital Returns course · Lesson 14 of 26

Formula

Dividends Per Share / Earnings Per Share

What it is

The dividend payout ratio shows what portion of profit a company hands back to shareholders as dividends. The rest, called the retention ratio, is reinvested in the business. It is usually expressed as a percentage.

Why it matters

It signals how sustainable a dividend is: a ratio near or above 100% means the company is paying out more than it earns, which is hard to maintain. A very low ratio can mean a young, growth-focused company or simply room to raise the dividend later.

How it's calculated

Divide total dividends paid (or dividends per share) by net income (or earnings per share) for the same period, usually shown as a percentage.

How Quintarthai uses it

Dividend yield is shown in the Summary Key-metrics grid, and payout figures are available across the screener and company pages on the Ratios tab. Open a company page in the app to review them.

Cross-border note. Canadian dividends paid to US investors may face withholding tax (often 15% under the tax treaty, and exempt in certain registered retirement accounts), which reduces the dividend the investor actually receives but does not change the company's reported payout ratio.

FAQ

What is a healthy payout ratio?

It varies by industry, but mature companies often pay 30-60% of earnings; stable utilities and REITs run higher, while ratios over 100% suggest the dividend may be at risk.

Should I use earnings or free cash flow for the payout ratio?

Both are useful. The earnings-based ratio is standard, but a payout ratio based on free cash flow is often a stricter test of whether the dividend is truly covered by cash.

See Dividend Payout Ratio on a real company

Open any stock in Quintarthai and explore it live across the screener and company pages.

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