Stock that entitles the holder to a fixed dividend, whose payment takes priority over that of common-stock dividends.
- Every company has a hierarchical structure of rights which accompany the three main classes of securities that companies issue: bonds, preferred stock, and common stock.
- He learned, for example, to issue equity in preferred stock rather than in common stock in order to avoid what's known as the ‘cheap stock’ issue.
- Indeed, payment of dividends could begin as early as next year, with holders of preferred stock receiving the first dividend payments.
Definition of preferred stock in:
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