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Friday, October 11, 2019 7:20:50 AM
Interestingly, they later talk of "conversion" of preferreds to common.
Now that does not make sense..why would anyone want to convert a so called "prized" stock to one of lesser value??? That is, why would anyone want to convert a low perfomrance preferred for a higher performing common?
If you look at the price THIS YEAR, the commons have gone from about a buck to upper/middle 3 bucks..about a 3.5 times increase.
However, the preferreds have performed much worse, not even doubling. So why would anyone in their right mind exchange a stock that more than tripled in the past year, for a stock of the same company which performed less than half as well???
Instead, you should covert your preferreds to commons now, getting rid of a low performer limited by par value and non cumulative dividends, which are non voting shares.
The commons are not restricted with the "non cumulative" tag, they are voting shares, and not limited by par value. So, the commons will, AGAIN, likely trade higher than the preferreds, like they did in 2006. Once dividends are restored, there is nothing to prevent preferreds from getting a single current dividend, while commons get "back" (retro) dividends, if/when the courts rule in favor of the shareholders and require a return of monies confiscated by the net worth swipe.
Given that the commons vastly outperformed the preferreds, mostly because novices dont understand what "preferred" means, why own preferreds, especially now that net worth swipe has been suspended temporarily, and there are few senario's, if any, where the preferreds outperform the commons?
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