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I am looking at investing in a few companies which offer preferred stock. Do their dividend coverage ratios factor in the dividends being paid to preferred shareholders? If not, how can I find or determine an 'adjusted dividend coverage ratio' that includes preferred stock? Thank you.

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  • "Do their dividend coverage ratios factor in the dividends being paid to preferred shareholders?" — Where did you get the data for the dividend coverage ratio?
    – Flux
    Aug 29 at 4:21

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Dividend Coverage Ratio is calculated as the total net income minus any required preferred dividend, divided by the amount of the dividend. It can also be calculated as EPS/DPS, where EPS is net income minus preferred dividends.

So, yes, they factor in the dividends being paid to preferred shareholders.

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