6 To compute the payout ratio over the entire period, we first aggregated earnings and dividends over the entire period and then divided the aggregate dividends by the aggregate earnings. This avoids the problems created by averaging ratios where outliers (very high ratios) are common.

As with Disney, the payout ratio and the cash returned as a percent of FCFE tell you different stories. While Aracruz paid out 60.42% of its aggregate earnings over the period as dividends, the total cash returned as a percent of aggregate FCFE was in excess of 100%. Some of the dividends were clearly funded using cash accumulated at the start of the period. §2»

^ dividends.xls: This spreadsheet allows you to estimate the free cash flow to equity and the cash returned to stockholders for a period of up to 10 years.

9bl._ - divfcfe.xls: There is a dataset on the web that summarizes dividends, cash returned to stockholders and free cash flows to equity, by sector, in the United States.

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