Bank of America: Higher Yielding Preferred Stock Is Still Attractive

Bank of America's preferred dividends remain well-covered, with less than 5% of net profit needed to service them, ensuring strong income security. The Series GG preferred shares offer a nearly 6% yield, and post ex-dividend, the effective yield rises above 6%, making them attractive for income investors. Despite call risk, BAC has not redeemed these preferreds, suggesting they may remain outstanding due to the reasonable cost of equity for the bank.