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Wed. Oct. 14, 2009 Dividends4Life classics, commentary

Dividend Payout vs. Free Cash Flow Payout

I am a firm believer in keeping things simple. However, you can simplify things to the point they no longer have value. In my opinion, a lot of the commonly used financial metrics can be very misleading unless you understand what is behind them. I would put EBIT, EBITDA and Dividend Payout in this category. As an investor in dividend stocks, I see Dividend Payout used a lot, so let’s take a closer look at it.

Oracle (ORCL): The Birth Of A New Dividend Stock

It is a powerful statement when others are hoarding cash that a company has the confidence to declare its first dividend to eliminate excess cash. Oracle (ORCL) did just that on Wednesday when it reported third-quarter EPS of $0.35/share, $0.03/share better than the analyst estimate of $0.32/share, and it declared its first ever dividend of $0.05/share. The dividend yield is 1.15%. ORCL is a leading supplier of enterprise database management systems and business applications.