P (Fifth-Letter Identifier)

What Is P (as a Fifth-Letter Identifier)?

Whenever utilized as the fifth letter in a ticker symbol, the letter P demonstrates that a security is a first-preferred stock issue. Preferred shares are equity shares that act somewhat like fixed income in that they grant higher priority than common shareholders and pay normal dividends higher than on common shares. A first-issue preferred demonstrates that it has priority over second-or following issues.

Alluded to as a fifth-letter identifier, "P" and numerous other letters of the alphabet can be utilized to show that a security isn't common stock, yet has a special characteristic.

Grasping P as a Fifth-Letter Identifier

Fifth-letter identifiers are found on stocks listed on the Nasdaq and Over-the-Counter Bulletin Board (OTCBB). There are several distinct fifth-letter identifiers, going from beginning to end, and each letter addresses an alternate characteristic. While P shows a first preferred stock, other instances of such characteristics and their identifiers incorporate Class A shares ("A"), Class B shares ("B"), new issues ("D"), and foreign ("F").

The majority of the letters signify similar characteristics whether the stock is listed on the Nasdaq or OTCBB, yet there are a couple of differences between Nasdaq fifth-letter identifiers and OTCBB fifth-letter identifiers. For example, the OTCBB utilizes the letter "Q" to mean a company engaged with bankruptcy procedures, while the Nasdaq does not do anymore. In such a case, P alludes to first-preferred stock on the two exchanges.

Preferred stock ownership accompanies greater rights than ownership of common stock. Preferred shareholders receive fixed dividends and are paid dividends before common shareholders. Preferred shareholders likewise have priority in being repaid in the event that a company exchanges. Be that as it may, bondholders have priority over preferred stockholders, and preferred stock dividends can be kept at the company's carefulness. Preferred shares as a rule don't carry voting rights, and most are callable, and that means the issuer can reclaim the shares whenever.

On the New York Stock Exchange (NYSE) stock tickers with special conditions will rather frequently utilize a fourth letter.

Priority Matters

Bondholders, and especially bondholders of secured bonds have the highest priority with regards to repayment or claims against a company. Common stock has the least priority. Preferreds fall some place in the middle. This is known as absolute priority or liquidity preference. In the event of a bankruptcy, preferred shareholders would be paid back in full before common stockholders receive anything.

At the point when a company has more than one simultaneous issues of preferred stock, they are positioned by priority. The people who hold first-preferred stock have status, especially with respect to dividends and assets, over other preferred stockholders.

Preferreds accordingly have an internal preference order, that will incorporate those shares that are indicated as second-preferred stock (set apart with the fifth-letter identifier "O"), third-preferred stock (signified with "N"), and fourth-preferred stock (meant with "M"). In any case, first-preferred shareholders are as yet subordinate to earlier preferred stockholders and bondholders.

Features

• At the point when utilized as the fifth letter in a ticker symbol, the letter P shows that a security is a first-preferred issue.
• Fifth-letter identifiers are found on stocks listed on the Nasdaq and Over-the-Counter Bulletin Board (OTCBB).
• Preferred stock ownership accompanies greater rights than ownership of common stock.