Payout ratio (Ausschüttungsquote)
The share of its profit that a company pays out to shareholders as a dividend.
In short
As of 8 October 2026The payout ratio shows what share of profit a company pays out to shareholders as a dividend. If it earns 4 euros per share and pays 2 euros, the ratio is 50 %. For established companies, 40 to 60 % is common. A ratio that stays above 100 % is a warning sign, because the company pays out more than it earns.
The payout ratio divides the dividend paid by the profit. It shows how much of the money earned goes to shareholders and how much stays in the company, for example for investment or paying down debt.
For established companies, 40 to 60 % is common. If it stays above 100 %, the company pays out more than it earns, which only works for a while. That is why it helps to look beyond earnings per share at cash flow, which is what the dividend is actually paid from.
Example: a company earns 4 euros per share and pays a 2-euro dividend. The payout ratio is 50 %. The chapter on dividends explains more.
Related terms
Sources
As of 8 October 2026 · Educational content, not investment or tax advice.