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Preferred stocks are privileged stocks that are paid dividends before making any payments to the common shareholders. They carry components of both debt and equity, thus reducing overall investment risks. Preferred stocks are a good quality option for generating income return. Therefore, I have picked 8 stocks though offer competitive yields than fixed income products.

Bank of America Preferred Series 7 (BACPRD):

This Bank of America (NYSE:BAC) preferred stock trades at a discount to its par value, offering a high dividend yield of 6.25% at par. With a credit rating of Ba3/BB+ and increasing cash flows, and cash on hand of $638.54 billion against debt of $771.97 billion, I expect that the bank will be able to pay its preferred obligations on time. The current ratio is 1.02.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
Bank of America, Prfd. Series 7 BACPRD $19.16 28650 $24.39 $15.50 $1.56 8.10%

Apartment Investment and Management Preferred (AIVPRZ):

AIMCO’s (NYSE:AIV) diversified portfolio, property refinancing and securitization will help the company generate decent cash flows in the future. It has a current ratio of 1.60, indicating that the company should be able to pay its preferred obligations on time. Moreover, as per most recent quarters, the company has cash on hand of $85 million and a total debt of $5.3 billion. S&P has rated AIVPRZ as B+. The stock trades at a discount from par, offering a yield of 7.44%.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
AIMCO Class Z Preferred Stock AIVPRZ $23.50 940 $24.25 $21.54 $1.75 7.44%

Axis Capital Holdings Ltd, Series B Preferred (AXPHF):

Axis (NYSE:AXS) has a high quality diversified and liquid portfolio. In the most recent decade, the company has gained in strong reputation in the insurance business. Axis has a good liquidity position; it has a total cash of $1.06 billion against total debt of $994.38 million. I believe that the company will be able to make its preferred payments on time. The stock has been rated BBB by S&P and has a yield of 7.5% at par.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
Axis Capital Holdings Prfd.

Series B

AXPHF $94.50 0 $100.00 $88.50 $7.50 7.94%

BioMed Realty Trust, Inc. Series Preferred (BMRPRA):

BioMed (NYSE:BMR) has an attractive business model with a focus on core U.S. life science clusters. The company is expected to benefit from strong demand from the life science industry. I believe that the company will have no problem paying preferred obligations. It has a debt to equity and current ratio of 69 and 0.91, respectively, Cash on hand is $12.03 million against debt of $1.59 billion. It offers a yield of 7.35%.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
BioMed Realty Trust, Series Prfd. BMRPRA $25.05 5020 $26.27 $23.90 $1.84 7.35%

BRE Properties Inc., Series D Preferred (BREPRD)

BRE Properties (NYSE:BRE) has a strong financial position with high quality assets. The company claims to have significant access to liquidity, which will enable the company to pay its liabilities on time. As per the recent quarterly numbers, BRE has $6.83 million of cash against $1.64 billion of debt. It has a low current ratio of 0.05. The stock trades above its par value and yields 6.69%.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
BRE Properties Inc.,

Series D Prfd.

BREPRD $25.25 5973 $25.50 $23.89 $1.69 6.69%

Central Hudson Gas & Electric Corp., Series Preferred Stock (CHGEL);

The company has been able to maintain high liquidity and credit worthiness over the years. Its preferred stock trades below its par value, offering a decent yield of 5.9%. The stock has A- rating by S&P. With $42 million in cash on its books and $140 million in cash flow from operations, I expect that CH Energy Group (NYSE:CHG), Central Hudson's parent, will pay its preferred obligations. This is a good example of a sleepy utility, in this case, servicing New York's Hudson Valley, that offers great-yielding preferred shares.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
Central Hudson Gas & Electric Series Prfd. CHGEL $94.00 0 $99.50 $83.50 $4.96 5.90%

Citigroup Inc., Series F Preferred (CPRM):

Citigroup (NYSE:C), a renowned name in financial sector, believes that the company’s growth in consumer banking and transaction services will help company to post decent growth and overcome market challenges. Citigroup has a strong liquidity position; cash on hand is $798.23 billion against debt of $688.01 billion. It has a current ratio 1.11. I expect company to meet its preferred obligations. Its preferred yields 8.44%, with BB+ rating by S&P.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
Citigroup Inc., Series F prfd.

CPRM $25.25 10440 $26.98 $23.75 $2.13 8.44%

Gabelli Equity Trust, Series F Preferred Stock ((GABPRF):

The Gabelli Equity Trust (NYSE:GAB) has an experienced and dedicated team, which is expected to drive company’s growth and future cash flows. The preferred stock has an AAA rating by Moody’s and it offers a decent yield of 6.08%. I expect that the company will not have any problem making preferred payments on time. It has a high current ratio of 2.58, providing a margin of safety against uncertainties.

Symbol Price Vol 52 Week

High

52 Week

Low

Div Yield
Gabelli Equity Trust, Series F Prfd. GABPRF $25.51 2786 $26.53 $24.76 $1.55 6.08%
Source: 8 Low Risk, High-Yield Preferred Stocks To Consider