What is CUMULATIVE PREFERRED STOCK?

PREFERRED STOCK that includes a feature allowing any foregone or suspended DIVIDEND payments to automatically accumulate. When the company restarts its program, cumulative preferred stock investors are entitled to receive all accumulated dividends before dividends can be paid to COMMON STOCK or NONinvestors.

More On This Topic



Link to This Definition
Did you find this definition of CUMULATIVE PREFERRED STOCK helpful? You can share it by copying the code below and adding it to your blog or web page.
Written and fact checked by The Law Dictionary