So, as you can see, there's no magic number that's appropriate for all companies. Of course, the lower the better, but as a general rule I would seek the following:
- REITs with an FFO payout ratio below 85%
- Higher growth common stocks that pay out less than 50% of FCF
- Banks that pay out less than 60% of FCF
- Regulated utilities that pay out less than 80% of FCF
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