Preferred w/coupon of 6.625%. Baa3 Rating. Call date 2/23/17. Pays $1.656 per annum.
At today's price of $23 = 7.2% yield. If held to call, $5.80 div + $2 current discount to par = $7.80 total return.
31% return over 4.5 years = 6.8% annualized.
The call date is a one way street. NNN can choose to call the preferred stock or not. If the stock price is less than $25.00, they would simply buy the stock on the open market--assuming interest rates were low enough. The real question is: Why is NNN selling so cheaply compared to O-PE or VNO-PI and other preferred stocks, which have a yield significantly under 7%. Something is amiss, like NNN is going to skip a payment or two.
NNN cannot call until call date but may not callat that time and will continue paying dividends until they call. They will pay your $25 back when called. Usually, these preferreds get closer to par as they get closer to call date (maturity). NNN-PD and NNN-PE are fairly recent issues.
NNN-PE is a strong buy. These preferreds got beaten up with the taper scare as did NNN.
It is virtually IMPOSSIBLE for a company to miss a payment or two on its preferred stock dividends. In order to do that it would first have to suspend the 5% dividend on the common shares. Moody's ranks this issue as 'investment grade' . So unless you feel the company is about to file for bankruptcy this payment is safe.