Having looked at the most important ratio for dividend investors – the dividend yield – in the previous chapter, in this chapter we’ll look at some other ratios that can be useful.
You will from time to time come across various ratios mentioned in the financial press, but it is not necessary to understand them all, just the ones that are particularly relevant to the payment of dividends.
Nor is it necessary to have an A level in maths. A simple grasp of basic sums will do. Ratios are simply one number divided by another.
Ratios are vital tools for investors. They help you to compare the performance of different companies. They can show whether a company is improving its performance, going backwards or standing ...