They are stored as xml files in your app directory, with permissions that allow only your app to access them. But on rooted device they are easily accessible. If you are concerned with security then you may use encryption, those projects might be usefull to you:
https://github.com/rtoshiro/SecureSharedPreferences
https://github.com/sveinungkb/encrypted-userprefs
still those projects does not give you 100% guarantee, hacker may decompile your apk and find keys used to encrypt shared preferences. So if your data is of use only for short time then remember to remove it from your device once user has finished using it. You may for example keep data on server and download it only when needed, caching locally only for short time - when its needed.