Power Corp's Preferred Shares Yield Above 6% Amid Flat Trading

In a recent report, Power Corp. of Canada's Non-Cumulative First Preferred Shares, Series C, are trading with attractive yields surpassing 6%. However, these shares come with risks, especially regarding dividend payments. Investors are advised to weigh these factors before making investment decisions.

Date: 12-12-2024

AI Rating: 5

The report highlights key aspects of Power Corp. of Canada's Non-Cumulative First Preferred Shares, Series C, including a substantial yield of over 6%. This high yield could attract income-focused investors looking for reliable returns.

However, it's important to note that these shares are non-cumulative. In cases where the company misses a dividend payment, preferred shareholders will not receive the missed payment prioritization. This risk could impact investor sentiment negatively, as the potential for missed payments may deter risk-averse investors.

As for the performance of the shares, they are currently trading at a 2.60% discount to their liquidation preference amount, which may further indicate a perception of risk among investors. With shares trading flat on the day and the common shares down about 0.4%, it suggests a lack of bullish momentum in the market for Power Corp. at this time.

Overall, the yield above 6% could be appealing; however, the non-cumulative nature of the shares and the recent performance trends might make some investors hesitant. The risks associated with non-cumulative dividends should be carefully evaluated against the potential income benefits.

Stocks: POW.TO