Dividend payout ratio (DPR)


    The dividend payout ratio (DPR) is a measurement of how much a company pays out to investors in the form of dividends.

    The DPR is calculated as follows:

    DPR = dividends per share / earnings per share

    For example, if a company pays out $2 per share and has $4 of earnings per share, the DPR would be 0.5 or 50%.

    Applying this figure in a useful way can be difficult, because a growing company may use money to fuel further growth rather than paying it out. Companies in mature industries, on the other hand, might pay out more in dividends.