The payout ratio is an excellent tool for dividend investors. Without it, it's tough to judge how sustainable a company's dividend is. Though a lower payout ratio is always better than a high payout ratio, some companies can easily cope with higher ratios than others. In the video below, Fool contributor Daniel Sparks looks at Apple (AAPL -1.92%), Microsoft (MSFT -0.40%), and Waste Management (WM 0.97%), illustrating how the ratio deserves careful attention during analysis.
1 Ratio Every Dividend Investor Must Know
By Daniel Sparks
-
Apr 23, 2013 at 10:45AM
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If you are an investor looking for income, you'll need to understand this ratio.
Stocks Mentioned
Apple Inc.
AAPL
$140.36
(-1.92%)
$-2.75
Microsoft Corporation
MSFT
$259.62
(-0.40%)
$-1.03
Waste Management, Inc.
WM
$157.60
(0.97%)
$1.52
*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.
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