Where will Alphabet stock (ticker: GOOGL) be in 3 years?
How would you like to be paid 6.25% dividend rate while you wait?
Alphabet Convertible Preferred Stock (ticker: GOOGM) may be the investment you are looking for - high-yield "qualified dividend" income with the potential for capital appreciation on the GOOGL underlying stock.
The stock IPO'ed at par $50/share and will pay an annual dividend rate of 6.25%.
If you meet the holding requirements (you will if you hold to conversion), the dividends are qualified under IRS tax rules. Qualified dividends are taxed at 0%, 15%, or 20%, depending on your taxable income and filing status.
Unless there is an unexpected event leading to early conversion, the preferred stock will convert to GOOGL shares on May 15, 2029. Each GOOGM share will convert to a fractional share of GOOGL based on the then current price of GOOGL stock.
At the present moment, Alphabet's business is growing. Here is a breakdown of their segments from their latest earnings report (July 2026).
Their new crown jewel, Google Cloud, is their fastest growing segment. They count among many other key AI players, Anthropic, as a customer. Google Cloud operating income nearly tripled to $8.8 billion, and Cloud backlog jumped to $514 billion.