Cumulative Preferred Stock

A type of preferred stock with a provision that stipulates that if any dividends have been omitted in the past, they must be paid out to preferred shareholders first, before common shareholders can receive dividends.

A preferred stock will typically have a fixed dividend yield based on the par value of the stock. This dividend is paid out at set intervals, usually quarterly, to preferred holders. If a company runs into some financial problems and is unable to meet all of its obligations, it will likely suspend its dividend payments and focus on paying the business-specific expenses. If the company gets through the trouble and starts paying out dividends again, it will first have to pay back all of the dividends that are owed to preferred share holders.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Cumulative preferred stock — Preferred stock whose dividends accrue, should the issuer not make timely dividend payments. Related: non cumulative preferred stock. The New York Times Financial Glossary * * * cumulative preferred stock cumulative preferred stock ➔ stock1 * * * …   Financial and business terms

  • cumulative preferred stock — preferred stock whose dividends accrue, should the issuer not make timely dividend payments. Related: non cumulative preferred stock. Bloomberg Financial Dictionary * * * cumulative preferred stock cumulative preferred stock ➔ stock1 * * *    A… …   Financial and business terms

  • cumulative preferred stock — see stock Merriam Webster’s Dictionary of Law. Merriam Webster. 1996 …   Law dictionary

  • cumulative preferred stock — noun preferred stock whose dividends if omitted accumulate until paid out • Syn: ↑cumulative preferred • Hypernyms: ↑preferred stock, ↑preferred shares, ↑preference shares …   Useful english dictionary

  • cumulative preferred stock — Fin preferred stock for which dividends accrue even if they are not paid when due …   The ultimate business dictionary

  • cumulative preferred stock — In the USA, stock in which the dividends accumulate if not paid out in a particular financial period …   Big dictionary of business and management

  • Non-cumulative preferred stock — Preferred stock whose holders must forgo dividend payments when the company misses a dividend payment. Related: Cumulative preferred stock …   Financial and business terms

  • non-cumulative preferred stock — preferred stock whose holders must forgo dividend payments when the company misses a dividend payment. Related: cumulative preferred stock. Bloomberg Financial Dictionary …   Financial and business terms

  • Preferred stock — Financial markets Public market Exchange Securities Bond market Fixed income Corporate bond Government bond Municipal bond …   Wikipedia

  • cumulative preferred — noun preferred stock whose dividends if omitted accumulate until paid out • Syn: ↑cumulative preferred stock • Hypernyms: ↑preferred stock, ↑preferred shares, ↑preference shares …   Useful english dictionary

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