dividend cover

noun

1. the number of times that a company's dividends to shareholders could be paid out of its annual profits after tax, used as an indication of the probability that dividends will be maintained in subsequent years

Example Sentences

Aside from Aberdeen's reduced dividend cover, Shore Capital's McGinnis said the issue of regulatory capital was not a major concern as most firms had little debt and were well-capitalized already.

From Reuters

It is also that dividend yield has come at the expense of dividend cover: Management teams have doled out an ever higher proportion of earnings to keep shareholders on board.

From Wall Street Journal

Ditching these so-called established products makes long-term sense, since their sales are declining, but they remain extremely profitable, so a sale looks set to dilute earnings per share, tightening dividend cover further.

From Reuters

Analysts said a dividend cover ratio of 2 or higher suggests a company is in good financial shape to pay dividends, but a level below 1.5 indicates that it might struggle to maintain payouts.

From Reuters

The ability of the telecoms and utility companies to pay rich dividends could come under stress as their dividend cover - the ratio of earnings to payouts - hovers at around 1.5 times against a long-term average of 2.0 to 2.5 times, according to industry figures.

From Reuters