First-Preferred Stock

You’re waiting to board an airplane. You hear “Sapphire group now boarding.” Then “mega-Platinum shiny-things group, now boarding,” yada yada yada.

A first-preferred stock is like these boarding groups: it’s one of many groups of stocks, with each group getting treated a certain way and costing a certain amount.

First-preferred stockholders don’t have voting rights, but they are in a group above second-preferred stock and common stock when it comes to dividends and assets.

That means that, when times are good, first-preferred stockholders will be getting the extra dividends before others. When times are bad, first-preferred stockholders will be getting payouts before common stockholders (and second-preferred stockholders).

First-preferred stock is like being in business class...or wait, maybe the gold, ruby, professional business class.