Preferred Dividend

Definition - What does Preferred Dividend mean?

Preferred dividends are types of dividends that are either paid on the preferred stock or to the holders of all such stocks. Preferred shareholders who are usually paid a fixed amount, and who are at a priority from a common shareholder, are generally paid this dividend.

Justipedia explains Preferred Dividend

These dividends are paid to one particular class of stockholders by virtue of a contract. If the company by any chance fails to pay all of the dividends, claims for preferred dividends are considered before any claims for dividends on common share.

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