Pay Attention to Payout Ratio

Photo: Barcelona Palace, Spain

When looking at stocks for good dividend yields,”Payout Ratio” is one of the many factors that have to evaluated. Payout ratio simply means the amount a company is paying
out to investors in the form dividends from its earnings.

High pay out ratio shows that the company wants to hand out more of the profits to shareholders as opposed to retaining it for growth purposes.Typically mature banks and utilities have high payout ratio.

The following list shows three stocks with high payout ratio for 5 years average:

1.Company:Bank of Novo Scotia – BNS
Dividend Payout Ratio 5 year Avg: 40.0%

2.Banco De Chile – BCH
Dividend Payout Ratio 5 year Avg: 57.0%

3.Banco Bilbao Vizcaya – BBV
Dividend Payout Ratio 5 year Avg: 38.0%

Related Posts:
1.High Dividend Growth Rate ADRs

2. How do you Analyze a Bank Stock? – Part II

3. How do you Analyze a Bank Stock?

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