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Answer :
Final answer:
The dividend payout ratio for Honeywell Inc. is determined by dividing the annual dividends per share ($2.40) by the earnings per share ($4.40). This results in a dividend payout ratio of 54.54%.
Explanation:
The dividend payout ratio is a financial metric that shows the proportion of earnings a firm pays to its shareholders in the form of dividends from its net income. In your case, if Honeywell Inc. is currently earning $4.40 per share and pays out $2.40 in dividends per share, the dividend payout would be calculated by dividing the annual dividends by the earnings per share.
Dividend Payout Ratio = Annual Dividends per Share / Earnings per Share
Thus, = $2.40 / $4.40 = 0.5454 (or 54.54%)
So, the dividend payout ratio for Honeywell Inc. is 54.54%. This means that Honeywell Inc is distributing 54.54% of its net income to shareholders as dividends, and retaining the rest for re-investment into the business or to cover future expenses.
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Answer:
$54.54%
Explanation:
Data provided as per the question below:-
Dividend payments = $2.40
Earnings = $4.40
The computation of dividend payout is shown below:-
Dividend payout ratio = Dividend payments ÷ Earnings × 100
= $2.40 ÷ $4.40 × 100
= $54.54%
Therefore for computing the dividend payout ratio we simply divide earnings by dividends payments and convert into percentage.
