Calculate the dividend paid and capital expenditure coverage ratio, a solvency ratio that measures a company’s ability to cover both its capital expenditures and dividend payments with its cash flow from operations.

The capex dividend coverage ratio assesses whether a company’s cash flow from operations is sufficient to cover both its capital expenditures (which are essential for maintaining and growing its business) and its dividend payments to shareholders. A higher ratio indicates a stronger ability to fund both capex and dividends from operating cash flow.

The formula is as follows:

\[\text{Dividend Paid and Capital Expenditure Coverage Ratio} = \text{Cash Flow from Operations} / (\text{Capital Expenditure} + \text{Dividends Paid})\]

Also known as: capex dividend coverage.

No programming experience? With the Finance Toolkit MCP server, AI assistants such as Claude and ChatGPT can calculate the CAPEX Dividend Coverage Ratio for you. Just ask in plain English.

Calculate the CAPEX Dividend Coverage Ratio in Python

The CAPEX Dividend Coverage Ratio is available in the Ratios module of the open-source Finance Toolkit. Install it with:

pip install financetoolkit -U

Then call get_capex_dividend_coverage_ratio as shown below.

from financetoolkit import Toolkit

toolkit = Toolkit(["AAPL", "TSLA"], api_key="FINANCIAL_MODELING_PREP_KEY")

capex_dividend_coverage_ratios = toolkit.ratios.get_capex_dividend_coverage_ratio()

Which returns:

  2021 2022 2023 2024 2025
AAPL 4.0716 4.781 4.2543 4.7913 3.9623
TSLA 1.4346 2.053 1.4896 1.3157 1.7294

Parameters

get_capex_dividend_coverage_ratio accepts the following parameters:

  • rounding (int, optional): The number of decimals to round the results to. Defaults to 4.
  • growth (bool, optional): Whether to calculate the growth of the ratios. Defaults to False.
  • lag (int | str, optional): The lag to use for the growth calculation. Defaults to 1.
  • standardize (bool, optional): Whether to standardize (Z-Score) the result. When combined with growth=True, standardizes the growth values instead of the raw values. Defaults to False.
  • trailing (int): Defines whether to select a trailing period. E.g. when selecting 4 with quarterly data, the TTM is calculated.
Interest Coverage Ratio Equity Multiplier Debt Service Coverage Ratio Free Cash Flow Yield Net Debt to EBITDA Ratio Cash Flow Coverage Ratio CAPEX Coverage Ratio Debt to Capital Ratio Preferred Dividend Coverage Ratio Interest Paid to Interest Expense Ratio Asset Coverage Ratio Gross Debt to EBITDA Ratio

The Ratios module page introduces the module, and the sidebar lists all of its functions.

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