Dividends4Life: Top 13 Reasons To Invest In This Safe Preferred Stock - Yield 9%

With the 10-year Treasury bond currently trading at an all-time low of 1.4%, preferred shares are looking very attractive for high-dividend investors. Some preferred shares are even more attractive than others because they have a "failure to redeem" covenant, and will result in a high penalty rate if the shares were not redeemed at the stated maturity of the preferred shares. In effect, this acts like a soft maturity because it can force the issuing company to redeem the shares in order to avoid a penalty or a higher dividend payout. In such cases the preferred shares look more like "bonds with a stated maturity" rather than securities with a perpetual maturity.

One such share is the preferred C share of Tsakos Energy Navigation - ticker symbol TNP-PC. Tsakos Energy Navigation (NYSE: TNP) provides international seaborne crude oil and petroleum product transportation services worldwide. The company offers marine transportation services to national, major, and other independent oil companies and refiners under long, medium, and short-term charters. TNP-PC is a safe 9% yielder - covered 6 times by TNP's earnings. This special preferred share also comes with a "failure-to-redeem" clause - making this preferred share issue similar to a bond with a fixed maturity (bond-like risk). If the preferred shares are not called by the year 2020, the dividend yield will escalate at an astronomical level and will reach 25%.

Source: Seeking Alpha

Related Articles:
- 7 High-Rated Dividend Stocks With Above Target Returns
- 4 Dividend Stocks For Healthy and Wealthy Retirement
- 4 High-Yielding Utilities With A Growing Dividends
- 9 Dividend Stocks With A 10%+ Dividend Growth Rate
- 3 Styles Of Successful Dividend Investing

Click here to have future posts delivered to you for free!



Post a Comment

Note: Only a member of this blog may post a comment.


Popular Posts Last 30 Days