How does preferred stock compare to common stock?
The dividend on common stock is uncertain and variable: high when a company performs well, low or nonexistent when it fares poorly. Holders of preferred stock, however, get a fixed dividend—and one which, if not paid, accrues until it can be. On the other hand, preferred stockholders are not usually able to vote on pertinent resolutions unless dividends fall into arrears, while holders of common stock have voting rights based on the number of shares owned.
Related Questions
- How will I be able to reconcile my former class A preferred stock account balance to my new common stock and/or ESPP account balance after the reclassification?
- How are repeated conversions of preferred stock prevented from diluting the value of common stock?
- How does preferred stock compare to common stock?
