Payout Ratios: CAPEX-Heavy Industries and REITs
Look at appropriate payout ratios for CAPEX-heavy industries and real estate income trusts (REITs). If you don’t, you could be surprised by dividend cuts or miss out on great companies! The classic payout ratio is calculated like this: For some industries, this metric is completely misleading. Why? Because their EPS is not an accurate reflection of their ability to keep paying dividends. CAPEX-Heavy Industries Capital-intensive companies require large investments in capital …
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