Be sure of dividends

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There are two ways to confirm the sustainability of the dividends policy of a company:

Payout ratio. It's the portion of the profits of a company that goes to pay dividends. Is expressed as a ratio and is the result of dividing the dividend by net income and multiply the result by one hundred.

Dividend cover Ratio. It is the amount of profits distributed as dividends and total cash-flow. Used to indicate the dividend policy of the company and the possible distribution of future dividend payments.


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