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My entire career has been spent in industry within the finance and accounting realm. My career started in 1985 and has included exposure to implementing SFASs
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  • Free Cash Flow Payout Vs. Dividend Payout 3 comments
    Mar 19, 2013 7:38 AM | about stocks: IBM, LOW, GPC, T, JNJ, MSFT, CAT, CVX, SYY

    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 growth stocks, I see Dividend Payout used a lot, so let's take a closer look...

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    Stocks: IBM, LOW, GPC, T, JNJ, MSFT, CAT, CVX, SYY
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  • Eddie Herring
    , contributor
    Comments (2124) | Send Message


    Totally agree. Earnings can be too easily manipulated to look better than they truly are, or even if not manipulated too easily misunderstood because of accounting practices. Good stuff and always timely for reminding.


    19 Mar 2013, 09:38 AM Reply Like
  • Be Here Now
    , contributor
    Comments (6320) | Send Message
    Does your description of Statement of Cash Flows apply to REITs and MLPs?


    There was a recent article on SA that claimed that REITs are ponzi schemes, that dividends are paid from borrowings and/or dilutive stock issuance. If what you say about Statement of Cash Flows applies to REITs, that puts a stake in the heart of that claim.
    19 Mar 2013, 11:28 AM Reply Like
  • heglimp
    , contributor
    Comments (833) | Send Message


    An excellent article. This article explains a most important aspect a DG investor should use in analyzing whether to invest or not. We all can get caught up in accepting a payout % without understanding how it is calculated.


    Keep writing these short and to the point articles. It educates those who do not have such knowledge and re-inforces the evaluating process for those of us who do know.
    19 Mar 2013, 01:06 PM Reply Like
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