Reported 2 days ago
Preferred stock combines traits of both equity and debt, providing fixed dividends and priority in asset distribution, appealing to income-focused investors. To determine its value, one must calculate the fixed dividend payments against the required rate of return using the formula P = D ÷ r. This process helps investors assess whether preferred shares meet their financial goals and investment criteria. Additionally, one should consider other factors like callable features and market conditions that may influence the stock's value.
Source: YAHOO