Peyto Exploration & Development Corp T.PEY

Payout Ratio is 42% of FFO...Dividend is Sustainable

[JoeBravo1]

findace, you said, "to me, it feels like whistling past the graveyard. Again. Payout ratio 125% cannot persist if the notion is a "safe" dividend. Sorry to say, I'm long. "

Sure, if you want to look at EPS the payout ratio is 127%, but that's not how it's calculated.

You need to look at Free Funds from Operations which were $0.78 per share for the 3Q.

All companies use FFO or AFFO to calculate Payout Ratios.  I was invested in Sienna Senior Living.  Their EPS don't cover the Dividend Payout Ratio, but when you use AFFO, Adjusted Funds From Operations, the P/O ratio was 91.3% for 3Q.

Peyto's dividend is more than sustainable and safe, with a 42% P/O ratio to FFO.

[GregC24]

I am not sure how you can say "that's not how it's calculated" when there is literally a line item on page 2 of the MD&A called "Total Payout Ratio" which is 125% for Q3.   Are you saying the company is presenting incorrect information in its own financials?

[houbahop]

Peyto Net free cash flow from operation was $26m in Q3. Dividends was $65m. Make your own calculation...

[JoeBravo1]

Total payout ratio as per the company's financials takes into account the increase in Total Investment Expenses for the quarter.   I believe that is a non-operational cost.  If you look at FFO, which is the actual cash flow from operations, the dividend is safe. The company even states this in their outlook: Outlook The Company remains on track to execute a 2024 capital