Triton International Dividends

This is just in case others were unclear as to the status of the dividends paid by Triton International (TRTN) on their preferred stock. The prospectus on the issues have always been unclear as to whether they pay qualified dividends or not.

ALL DIVIDENDS PAID ON THEIR PREFERREDS THUS FAR ARE ‘RETURN OF CAPITAL’.

Data on the status of the various dividends can be found here.

As most of you probably know when a dividend is designated as ‘return of capital’ it reduces your cost basis of the shares.

For Instance

If you pay $25 for a share and receive $2 in return of capital distributions your cost basis in now $23. If you sell it for $25 you will have a $2/share gain since your cost basis had been reduced to $23 through receipt of a return of capital distribution.

The return of capital is not taxable – but upon the sale of the shares you may have a capital gain (or loss) and you will need to then pay taxes (if in a taxable account).

3 thoughts on “Triton International Dividends”

  1. Great info. Hold TRTN-B in a trust fund which only distributes true income and interest. Have no interest in ROC. Always try to find fund 19a notices to see where my distribution is coming from.

  2. I’m scratching my head. TRTN-B is 8% with a 12/24 call. It is trading at $27.12 for a current yield of 7.37%. and YTC of 5.55%. The new issue, TRTN-D (currently TRTDP), is 6.875% with 3/25 call. It is trading up at $25.58 for a current yield of 6.7% and YTC of about 6.42%.

    Why would someone buy TRTN-D over TRTN-B? Maybe not wanting to pay a $27+ price? The current YTC? Any other reason? And why isn’t TRTN-D selling somewhere between $24 and $25 instead of $25.58? As a buyer, would I have a reasonable expectation of the price staying up around $25.58, or is that too inflated compared to the yield of other Triton preferreds? Which would you buy?

    I am having trouble analyzing. I’d appreciate your guidance. Thanks.

    1. Just my 2c on what I do is to never pay more than about 1% over the base price – in this case $25.25-$25.30. If the call date is closer, then $25.00 or less. At some point it will gravitate to the call price. Others do not mind paying $26-$27 – it’s just not in my current ruleset.

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