Bank OZK: The 7.2% Yielding Preferred Shares Are Still Interesting

Bank OZK remains highly profitable, with Q1 net income of $159.3M and robust coverage of preferred dividends. OZK's disciplined underwriting is reflected in a 46% average LTV ratio, manageable loan loss provisions, and transparent quarterly loan reviews. The $200M share buyback program and successful monetization of $150M in foreclosed assets support capital returns and future earnings. OZKAP preferred shares offer a 7.18% yield at a 40% discount, presenting attractive risk/reward amid stable loan book performance.

In my previous coverage of Bank OZK (OZK), I argued the fears surrounding its portfolio of commercial real estate loans were overblown. While some loans indeed do need special attention, the bank’s team has shown it has been