Enter stock price and dividend info to calculate yield and payout ratio.
Frequently Asked Questions
What is dividend yield?
Dividend Yield = Annual Dividend Per Share / Stock Price × 100%. It's the key metric for measuring dividend returns. For example, a $100 stock paying $5/year has a 5% yield. Higher yield generally means more cash return.
What is payout ratio?
Payout Ratio = Dividend Per Share / Earnings Per Share × 100%. It shows how much profit is paid as dividends. Too high (>80%) may be unsustainable; too low (<20%) may indicate unwillingness to reward shareholders.
Is higher dividend yield always better?
Not necessarily. Abnormally high yield may result from a sharp price drop. Evaluate comprehensively: 1) Is payout ratio reasonable (30-60%)? 2) Is the company consistently profitable? 3) Has dividend grown steadily? Ideal yield is typically 2-6%.
How to calculate after-tax dividend yield?
After-tax yield = Dividend Yield × (1 - Tax Rate). For example, 5% yield with 20% tax = 5% × 0.8 = 4%. Tax rates vary by country and account type.