On-line Stock Trades

Dividend cover is basically a ratio of earning over paid dividend, that is yield by the division of earning with the business with the dividend paid to share holders in online stock trades. If the business have it earning about $15 and it has paid $ three to his share holders than its dividend cover will be $5.
Dividend cover also provides the particulars that how many times dividend can be paid more than the profit in on-line stock trades. Based on the examples given above, three indicates profit with the firm can be attributed towards the share holders 3 occasions of the quantity paid towards the dividend in on-line stock trades.
Mathematical representation of dividend cover of on-line stock trades is
DC = EPS .
DPS
From the expression it could be noticed that dividend cover is the reciprocal of dividend payout ratio of on-line stock trades, which can be manipulated as DPS / EPS.
DC ratio for any company is regarded as secure if it is equal to two or higher than it in online stock trades because at this position the company can spend its dividend easily. And the ratio below 1.5will becomes extremely risky in on-line stock trades. If the value of dividend cover goes beneath 1 than the business will use its retained revenue or profit of prior years to pay its dividend in online stock trades.
So from the above info it's obvious that dividend cover may be utilized for measuring the business?閿熸枻鎷穉??a?閿熸枻鎷穝 ability for paying off its dividend in online stock trades marketplace. Greater value of dividend cover will permit the business to manage its dividend. Lower degree of dividend cover can be accepted by the company with stable profit level in on-line stock trades. But getting the low level of dividend with the profit featuring volatility represents that company?閿熸枻鎷穉??a?閿熸枻鎷穝 dividends are at large risk in on-line stock trades.