Can Zions Bancorporation Series A Preferred (ZIONP) Reach $25?

Key Takeaways

• The selected price target is $25.00, the stated liquidation preference (par value) of each ZIONP depositary share.
• At roughly $18.35, the shares trade at a discount of about 27% to par, leaving meaningful upside of roughly 36%.
• ZIONP is a floating-rate preferred stock whose dividend rises when short-term interest rates rise, supporting income-driven demand.
• The biggest obstacles include interest-rate cuts, the security's non-cumulative dividend structure, and the issuer's right to redeem it.
• Key levels include the 52-week low near $18.08, a resistance zone near $19.28, and the prior high near $23.40 before par value at $25.
• The central takeaway: reaching $25 is possible but depends heavily on the interest-rate environment and Zions' credit profile.

What ZIONP Actually Is

Zions Bancorporation, National Association's Series A depositary shares (NASDAQ: ZIONP) are not a common stock or an exchange-traded fund (ETF). Each depositary share represents a 1/40th ownership interest in a share of the issuer's Series A floating-rate, non-cumulative perpetual preferred stock, with a liquidation preference of $25.00 per depositary share. The dividend is set at the greater of 4.0% or a floating rate equal to a short-term benchmark rate plus a spread, paid quarterly when declared by the board.

This structure is central to the price discussion. Preferred shares like this are anchored to their $25 par value: they pay a fixed-face dividend and are redeemable at par. As a result, $25 functions as a natural magnet and a widely followed price objective for holders buying at a discount.

Why Investors Are Watching the $25 Level

Because ZIONP carries a $25.00 liquidation preference, the question "Can ZIONP reach $25?" is the most relevant price-target inquiry for this security. The shares currently change hands near $18.35, well below that level, and have traded below par for an extended period. A return to $25 would represent both a full recovery to face value and a substantial capital gain for investors who bought at recent discounted prices, on top of a current yield of roughly 8% or more.

Current Market Position

ZIONP has been rangebound in the high teens for much of the recent period, with a 52-week range spanning roughly $18.08 to about $23.40. The shares sit near the lower end of that range, close to a key support level around $18.08. Above the current price, the $19.28 area has acted as near-term resistance, with the prior high near $23.40 representing the next major hurdle before any test of the $25 par value.

What Could Drive the Next Leg Higher

The strongest argument for a move toward $25 rests on the floating-rate feature. Because the dividend resets with short-term rates (the greater of 4.0% or a benchmark rate plus a spread), a sustained period of elevated or rising interest rates would boost the cash distribution and make the shares more attractive to income-oriented buyers. That dynamic could narrow the discount to par.

Credit fundamentals also matter. Zions Bancorporation is a long-established regional bank based in Salt Lake City, Utah, with roughly $90 billion in assets and a commercial-banking focus across the Western and Southwestern United States. As long as the issuer remains financially sound and well-capitalized, the market has a basis for repricing the preferred shares closer to their contractual value.

What Could Prevent the Move

Several obstacles stand between the current price and $25. First, the dividend is non-cumulative: if the board does not declare a dividend in a given quarter, the payment does not accrue and is not owed later. That feature, unusual relative to some other preferred structures, adds risk during periods of stress.

Second, interest-rate sensitivity cuts both ways. If the Federal Reserve lowers short-term rates, the floating dividend resets downward, reducing income and potentially weighing on the share price. Third, the shares are callable, meaning the issuer could redeem them at par if conditions make it economical to do so. While redemption at $25 would be favorable to holders who bought at a discount, it also caps long-term upside and can discourage the market from pricing shares all the way to par. Finally, regional-bank credit risk remains a consideration that periodically pressures preferred shares across the sector.

Technical Levels That Matter

From a technical analysis standpoint, $25 is a clear psychological and structural target tied to the liquidation preference. Support sits near the 52-week low around $18.08, and a sustained break below that level would signal renewed selling pressure. On the upside, the $19.28 zone has served as resistance, followed by the prior peak near $23.40. Reaching $25 would require the shares first to reclaim and hold above these intermediate levels, then absorb selling from holders who may use par value as an exit point.

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Final Assessment

A move to $25 is realistic for ZIONP but far from assured. The strongest supporting factor is the floating-rate dividend, which aligns the security's appeal with periods of higher short-term interest rates, along with the issuer's solid standing as a major regional bank. The principal risks are falling rates, the non-cumulative dividend structure, and the possibility of early redemption, which caps the share's practical ceiling at par.

Investors should monitor short-term interest-rate expectations, Zions Bancorporation's earnings and capital position, and whether the shares can hold support near $18 and reclaim the $19.28 resistance zone. A sustained break above those levels, combined with a stable or rising-rate backdrop, would strengthen the case for a gradual repricing toward the $25 liquidation preference.

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