Can someone please explain the following statement:
when an investee is profitable, and its dividend payout ratio is less than 100%, the equity method usually results in higher earnings as compared to accounting methods used for minority passive investments.
thanks 
Using the equity method, you show on your income statement your proportional share of the affiliate’s net income.
When you treat the ownership as an investment in securities, you show on your income statement your proportional share of the affiliate’s dividends.
The stipulation is that the latter is less than the former.