A common stock in a company with a constant dividend is much like a share of preferred stock because the dividend payout does not change. Financial managers also know that the rate of growth on a fixed-rate preferred stock is zero, and thus is constant through time. It's important to note that a company's stock can fall into more than one category. Large-cap stocks can be blue-chip stocks, growth stocks or income stocks, for example.Small-cap stocks can be growth stocks, income stocks, or tech stocks.However, perhaps the most important attribute of growth stocks is that like all stocks, their holders are the last in line when it comes to getting their Many conservative investors have even modified the Graham formula further to reach a defensive intrinsic value of the stocks. For example, Graham originally used 8.5 as the PE of the company with zero growth. However, many investors use this zero growth PE between 7 to 9, depending on the industry they are investigating and their own approach.