What is the expected yield on the newly announced preferred stock dividends compared to the current market rates?

Yield Outlook

Brighthouse Financial’s newly announced Series A non‑cumulative preferred stock carries a 6.60 % dividend rate. In today’s U.S. preferred‑stock market, comparable senior‑preferred issues are trading at yields roughly between 5.0 % and 6.0 % (e.g., large‑cap REIT‑linked preferreds and utility‑linked preferreds). Consequently, Brighthouse’s 6.60 % rate sits above the prevailing “mid‑range” preferred‑stock yield and offers a modest premium of about 0.5‑1.0 % over the bulk of the market.

Trading Implications

• Demand driver: The higher‑than‑average yield should attract income‑focused investors, especially those seeking a buffer against a flattening interest‑rate environment. Expect a buy‑side tilt in the short‑term, which could lift the Series A depositary shares (BHFAP) toward the upper end of the current price band.
• Risk considerations: The 6.60 % yield reflects credit risk tied to Brighthouse’s asset‑backed insurance portfolio. Watch the company’s solvency ratios, loss‑ratio trends, and any recent rating actions; a downgrade could compress the premium quickly.
• Positioning: For a yield‑seeking bias, consider a light‑to‑moderate long position on the Series A depositary shares, with a stop just below the recent support level (≈ $0.95) to guard against a potential credit‑event sell‑off. If the broader preferred market tightens (yields falling toward 5 %), the relative attractiveness of the 6.60 % series will rise, supporting a price rally. Conversely, if Treasury yields climb above 5 % and risk‑premiums compress, the premium may erode, prompting a partial exit.