How to calculate the price of preferred stock
The preferred stock valuation calculator exactly as you see it above is 100% free for you to use. If you want to customize the colors, size, and more to better fit your site, then pricing starts at just $29.99 for a one time purchase. Click the "Customize" button above to learn more! They calculate the cost of preferred stock by dividing the annual preferred dividend by the market price per share. Once they have determined that rate, they can compare it to other financing options. The cost of preferred stock is also used to calculate the Weighted Average Cost of Capital. Preferred stock typically pays dividends before any dividends are paid to common-stock holders. The dividend amount and rate of return makes it possible for investors to calculate the current market value of any preferred shares that they may own.