Shareholders' Flashcards
1
Q
Payout Ratio
A
Dividends1/Net Income1
Dividends per share/Earnings per share1
how much is distributed to shareholders in the form of dividends over the year as a percentage of net income
2
Q
Dividend yield
A
Dividend per share1/Market price of a share1
how much dividends investors are getting for every dollar that the stock is worth
3
Q
Price to earnings ratio (P/E) /Multiple
A
Market capitalization1/Net Income1
Market price of a share1/Earnings per share1
Market capitalization= Market price of Equity
how many times more the market is willing to pay for the stock compared to what it is worth (high P/E suggests high future growth)
