Retention Ratio Calculator (Plowback Ratio)

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Choose whether to enter raw figures or start from the dividend payout ratio.
Total profit after all expenses and taxes for the period.
USD
Total cash dividends distributed to shareholders in the same period.
USD
Turn on to enter return on equity and see the sustainable growth rate (SGR = ROE x retention ratio).
Retention ratioGrowth-oriented
0.75%

Fraction of net income retained for reinvestment (plowback ratio)

Dividend payout ratio0.25%
Retained earnings750,000USD
Dividends paid250,000USD

Retention ratio: 75.0% (plowback ratio)

  • The company retains 75.0% of earnings for reinvestment and distributes 25.0% to shareholders as dividends.
  • A ratio between 60% and 80% signals a growth-oriented strategy that still offers modest dividend income.
  • Of the $1,000,000 net income, $750,000 stays in the business.

Next stepCompare this ratio against industry peers and the company's own historical trend. A sudden drop may signal a maturing business or cash-flow pressure; a sharp rise may indicate a pivot toward growth.

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