mREIT Arbor Realty Trust Announces Earnings

Arbor Realty Trust (ABR) which has 3 high yield perpetual preferreds outstanding announced earnings on 2/14/2020.

With earnings that generally are pretty good, one has to wonder how long 3 issues of perpetual preferreds can remain outstanding–in particular one with a 8.50% coupon (ABR-C). Shares are all trading very strong with the ABR-C issue trading at $26.52–and it just went ex-dividend for 53 cents.

The earnings release can be read here.

New Version Sortable Spreadsheet Posted

We have posted a new version of the sortable spreadsheet which we initally released on 12/16/2019.

The new version has new issues added and redeemable issues removed–no other changes.

If you copied the original version you may want to delete the old version and replace it with the new version to have new issues (through 2/10/20) added and redeemed issues removed.

You can access the spreadsheet here.

Broker/Brokerage Section “Open for Business”

I have posted the new “Broker/Brokerage” discussion thread in the right hand menu (under additional links”.

If folks have comments, notices, complaints etc about particular brokers or brokerages please go here.

Like all the threads in the right hand margin the more folks stick to the topic the better it will be as a resource to others.

Dynex Capital Does a Surprise Partial Call

mREIT Dynex Capital (DX) announced a surprise partial call of their 7.625% DX-B shares of preferred stock late today.

DX which just sold a new issue of 6.90% perpetual preferred (4 million shares plus 600,000 for over allotment) had announced with the sale of this new issue they were calling for redemption their 8.50% DX-A issue for 3/14/20. There was no mention of a partial redemption of the 7.625% DX-B issue.

Lo and Behold late today commenter Ralph happened upon a press release stating the intention of the company to redeem 1.7 million shares of the DX-B issue on 3/16/2020.

The press release can be read here.

The DX-B issue closed Fridays trading at $25.55. This partial call should now peg the remaining shares closer to $25 plus accrued dividends for the future.

Sliding Into a Long Weekend

Markets are all kind of quiet–both stocks and bonds, as we look into a 3 day weekend (at least as far as stock and bond trading are concerned).

Stocks are moving around 1/10% right now and the 10 year treasury is off 3 basis points at 1.59%. It will be interesting to see the close today–seems likely that stocks may slide as folks bail out before any surprise news potentially comes out over the long weekend.

$25/share preferreds and baby bonds are moving little today (on average). All sectors are up a penny or down a penny.

We are still awaiting pricing on the new Orchid Island Capital (ORC) perpetual preferred. This happens on occasion–an issue is announced and then pricing is delayed or in some instances even cancelled. The company has not filed a cancellation notice so I assume the issue is still on.

This weekend I will setting up a new ‘discussion‘ area for “Broker/Brokerage” talk. We always have folks discussing the rules and regulations of the various brokers–what they will let us buy etc. I will be getting this set up in the right hand menu area. This will allow for keeping some of this info segregated and will hopefully be a reference area. Thanks to a number of folks for encouraging this area.

Additionally I started a new ‘study‘ on new issues. I began with the Southern Company 4.95% Notes (SOJD) on 1/6/2020. I have seen questions on the value of buying new issues and then flipping them during the 1st month (or sometime shortly after issuance). I am looking at the ‘opening trade’, 1st day close, and close after 30 days.

If you would have bought on the open on the issue above and sold on trading day 30 you would have banked a capital gain of 47 cents/share.

I will see if I can get the spreadsheet to be understandable and then post it. I update it each day with new issues etc.

mREIT Dynex Capital Prices Fixed-to-Floating Rate Preferred–UPDATE

UPDATE–the OTC Grey Market temporary ticker is DXPBN. Thanks to Bob-in-Thailand for being on this.

Dynex Capital (DX) has priced their previously announced fixed-to-floating rate preferred.

The company is selling 4 million shares plus 600,000 for over allotment with an initial fixed rate of 6.90%. The coupon will float starting 4/15/2025 at the rate of 3 Month Libor plus 5.461%.

The issue is unrated and will be cumulative but not qualified.

The permanent ticker will be DX-C when it begins to trade on the permanent exchange.

Issue will trade OTC immediately, but the temporary ticker has not been announced as of this minute-we will post it when it is announced.

The company will redeem their DX-A 8.50% perpetual preferred with the proceeds of this new offering.

The pricing term sheet can be read here.

REIT Medalist Diversified REIT Announces New Preferred–Updated

Update–JDubs has noted this issue will trade right away on the NASDAQ–no OTC trading–starting later today and tomorrow.

New REIT Medalist Diversified REIT (MDRR) which trades at $3.76/shares has announced a new high yield preferred issue. This is a tiny company and potential investors need to do some deep due diligence.

The issue has been priced at 8% with a public offering price of $23 ($25 liquidation preference). While this pricing is rare there have been previous offerings at lower than liquidation preference before–so it is not unique.

The issue is tiny at 200,000 shares (plus another 30,000 for overeallotment).

A new company presentation can be found here.

NOTE THAT THIS ISSUE HAS A MANDATORY REDEMPTION DATE OF 4/19/2025.

I am not seeing a OTC temporary ticker yet.

The pricing term sheet can be read here.

Thanks to Bob-in-DE for being early on this issue.

Stocks are Hesitant While Interest Rates Barely Move

For a change common stocks opened the day a bit weak, but since have risen to near even on some exchanges–no surprise. The 10 year treasury is off 1-2 basis points at 1.61%–hardly a move at all.

It is interesting that the corona virus is playing out like a few of our commenters thought it would–don’t believe the data from China is what they implored–and while traders moved on forgetting the virus the numbers grew by leaps and bounds overnight. I mentioned yesterday that ‘only a fool would ignore it in total’, referring to the virus. Thanks to some of our commenters I am keeping one eye on the situation.

Looking over some of the most recent new issues we see a mixed bag. The new Triton International 6.875% preferred (TRTN-D) has traded strongly–hitting $25.78 yesterday.

The new 6.25% term preferred from Oxford Lane Capital (OXLC) stays weak trading now at $24.70 as it is still trading on the OTC market under ticker OXCPP.

The Brookfield Property Partners 5.75% perpetual which just started trading on 2/11 is at $25.38 today on the OTC market under temporary ticker BOPTP.

$25/shares preferreds and baby bonds are off just a couple cents on the week. Banks show a 5 cent drop, but I see quite a few banking issues went ex-dividend today (some BAC, COF and Puerto Rican Bank, FirstBancorp, issues) so likely they are really flattish.

Folks are talking on the website about a number of items–as always.

There has been a little discussion on the just announced State Street (SST) call of a 5.25% preferred (SST-C). This kind of tells you where we are going with investment grade issues.

There is some discussion of the B Riley (RILY) new baby bond which is now trading under ticker RILYM at $24.95. At a 6.375% coupon is this one the best buy of all the issues the company has outstanding?

Also Bob-in-DE has posted a note on a new preferred which I hadn’t seen yet from Medalist Diversified REIT (who?) It is a 8% issue offering–I will get something out shortly. Bob’s note is ‘quite complaining about low rates’ (in jest I think).

Still Waiting Orchid Island Capital New Preferred Pricing

Smaller mREIT Orchid Island Capital (ORC) announced a new issue preferred earlier this week and we are still awaiting pricing.

I would expect we would see it priced tonight after the market close

When the issue does trade on its permanent exchange it will be under ticker ORC-A. It should trade on the OTC temporarily before permanent exchange trading, but no ticker has yet been announced.

mREIT Dynex Capital to Sell FTF Preferred In a Refi Transaction

mREIT Dynex Capital (DX) will be selling a new issue of fixed-to-floating rate preferred.

The company says they have already issued a call announcement for older issue DX-A, a 8.50% issue which was trading at $26.29 yesterday. Guess someone is going to take a bit of a spanking on this call.

The preliminary prospectus can be read here.

AT&T Prices New Perpetual Preferred

AT&T has priced the new previously announced perpetual preferred.

As expected the coupon is pretty low at 4.75% for 70 million shares

As you all know the company has a 5% perpetual outstanding which is trading around $25.97 after dropping yesterday on the new issue announcement–it had been at $26.40 or so. It can be seen here.

The pricing term sheet can be read here.

Big Ex-Dividend Days Coming

While it is nothing like the last 2 days of March, June, September and December, where we have around 110-120 preferreds and baby bonds going ex-dividend the next 2 days will see significant action.

On 2/13 and 2/14 we will see around 65-70 different issues going ex-dividend. This means we may see more ‘red’ show up on our screens as many of the quote providers do not adjust by the ex-dividend amount.

Something interesting that I sometimes see on ex-dividend date is that a few issues that are either in the early redemption window or near the early redemption date are marked down by the exchanges by the ex dividend amount and then they continue to fall.

For instance if an issue is trading at $25.75 and goes ex dividend by 35 cents the exchange will open shares at $25.40 on the ex date. If the issue is beyond the early call date or very near to it the shares may continue right to follow lower because of the potential call that may be near.

Nothing Can Keep This Market Down

We are back into a period where each day you wake up and the equity futures are up 1/2%–and then over the course of the morning they move even further higher. Obviously the coronavirus is no longer a headline–BUT this thing could flair up again and only a fool ignores it in total.

I look at the REIT indexes and they move higher and higher–the folks writing on SA on them are ‘heroes’ (in their minds) and others writing on junky stuff are also hero’s–or at least they are will take credit for good gains while shunning their lousy picks. A rising tide lifts all boats!

I am stuff watching my preferreds and baby bonds–directionally moving higher, but with smaller and smaller coupons being presented to us for the future.

Oh well – just give me my 6-7% annual returns–year in and year out–I would be ecstatic–even gleeful.

Folks on the site are mourning in advance of the pricing of the new ATT (T) perpetual preferred–they know the coupon will be inadequate–maybe even worse than inadequate considering it will be rated junk–just below investment grade.

Others are talking about the dividend capture on UMH-D–it goes ex dividend Friday for almost 40 cents and is trading at $25.05. It has traded within 2-3 cents of this level for weeks. UMH has to be in the ‘hated’ category of REITs–investors hate that the company, which is in the manufactured home site group, owns bunches of shares in junky REITs. Quite honestly they should sell those shares and pay debt or give it to the shareholders–but from a preferred stock investor perspective with a decent economy this 6.375% coupon is a gift almost–I have bought it 3 times recently (in my higher risk basket).

It is incredible how popular some of the segments on this website are becoming–we have reached a point where the Reader Initiated Alerts page is the most popular page on the site (after the homepage)–followed by the Sandbox Page and then Sock Drawer. No real surprise here–it is where the folks with knowledge and experience hang out–there is no better group to hang with–wish I had more time to do so.

The website is around 2,600 pages now, which means I have less and less time to invest while I do more and more (in the background) of the website. Oh well there will come a time when I can spend more time in discussion than on administrative.

AT&T to Sell New Preferred

AT&T (T) has announced the coming issuance of a new series of fixed rate preferred stock. The company is also selling a fixed rate reset euro preferred.

This will trade under the permanent ticker of T-C when it finally hits the big board for trading. The issue will trade on the OTC Grey market prior to the big board, but the ticker has not yet been announced.

The company currently has a 5% perpetual outstanding which can be seen here. This issue trades very strong at $26.40.

The preliminary prospectus can be read here.

EarlyBird is hearing yield talk in the 4.875-5% area.

Ptrader and EarlyBird were on this new issue right away.

Small mREIT Orchid Island Capital Announces New Fixed Rate Preferred

Small mREIT Orchid Island Capital (ORC) has announced a new issue of preferred stock..

The company has no other preferreds or baby bonds outstanding at this time.

While this was announced late yesterday it has not yet priced–EarlyBird is hearing price talk in the 6.75-6.875% area.

The preliminary prospectus can be read here.

EarlyBird was working overtime last night and had this at 5:31 pm.

New Residential Investment Corp Prices FTF Preferred

mREIT New Residential Investment Corp (NRZ) has priced the fixed-to-floating rate preferred previously announced.

The shares will carry a fixed rate of 6.375% for about 5 years–until 2/14/2025, after which it will float at 3 month Libor plus a spread of 4.969%.

The company currently has 2 other preferred issues outstanding, both fixed-to-floating rate issues, which have traded fairly strong–those issues can be seen here. Neither of these issues are redeemable until 2024.

These shares are unrated.

Trading commences immediately under OTC Grey market temporary ticker NRESP.

The preliminary prospectus can be read here.

mREIT New Residential Investment to Offer Fixed-to-Floating Rate Preferred

mREIT New Residential Investment (NRZ) will be offering a new issue of fixed-to-floating rate preferred stock.

The issue will trade with a permanent ticker of NRZ-C. The company has 2 other fixed-to-floating rate issues outstanding which can be seen here. Both issues trade relatively strongly.

The preliminary prospectus can be read here.

Affinity4Investing was quick on the draw on this one with mcg right with him/her.

B Riley Financial Upsizes Baby Bond Offering

B Riley Financial (RILY) which had initially announced a new offering of 2 million shares (bonds) has sold the issue and it has upsized the issue to 4.6 million plus an over allotment of 690,000.

The company has announced at least a partial redemption of 7.50% RILYZ notes. There are about 4.4 million shares of the RILYZ outstanding.

The coupon is 6.375%. The issue is rated BBB+ by Egan Jones.

An early redemption date starts on 2/28/2021–the company will pay a 3% premium the 1st year (2021-2022), a 2% premium the second year (2022-2023) and 1% the 3rd year (2023-2024). There after until maturity on 2/28/2025 redemption will be at $25 plus accrued interest.

There likely will be NO Grey Market Trading, but one may be able to secure some before exchange trading by calling their brokerage.

The pricing term sheet can be read here.

Gridbird was on top of this pricing.

B Riley Financial Anounces New Baby Bond Offering-UPDATE

UPDATE–the ticker for this will be RILYM when it hits the market in a week (more or less).

Financial firm B Riley Financial (RILY) has announced an offering of new baby bonds.

The new offering will mature in 2025 and will have an early call period starting in 2021. Like many of the B Riley baby bond issues the issue will have a bonus for early redemption–3% the first year, 2% the 2nd and 1% the 3rd year–then at $25 thereafter.

The company plans to use the proceeds to call at least a portion of the 7.50% baby bonds (RILYZ) which become callable 5/31/20

The preliminary prospectus can be read here.

Brookfield Property Partners LP Announces New Preferred Units

Giant Bermuda based partnership Brookfield Property Partners (BPY) has announced a new offering of cumulative, redeemable, perpetual preferred units (preferreds offered by partnerships are called units).

BPY is a giant partnership with over $88 billion in assets.

BPY has 2 other preferred units outstanding which can be seen here–both trade relatively strongly. They have coupons of 6.375% and 6.50% respectively. Neither are redeemable until 2024.

This issue will carry a K-1 with it at tax time.

This issue will be rated BB+ by Standard and Poors–1 notch below investment grade.

The preliminary prospectus can be seen here.

NOTE–watch the brokers for added charges on a purchase. They may classify as foreign and attempt to charge an extra $50.

Thanks to mcg and EarlyBird for being on this early. EarlyBird has yield talk in the 6% area. Most issues lately are coming in a little below the yield talk.

If this coupon does hit the 6% mark I may be buying some of this–assuming it doesn’t come out of the gate ‘hot’.

Monday Morning Kickoff

Here we go–a new week–what does it have in store for us?

As noted by Fabrib we kick the week off with REIT Simon Properties Group (SPG) announcing a buy of Taubman Centers (TCO). TCO has 2 preferred issues outstanding which can be seen here. Both are now callable and trading quite a bit above $25. I haven’t looked yet to see what the terms of the deal are yet–and they probably aren’t announced yet.

Also tim.moore notes a new issue of B Riley baby bonds is coming with a likely partial call of the 2027 7.50% issue (RILYZ) redemption.

Last week the stock markets had strong gains–party on I guess. The S&P500 opened the week at 3236 and closed the week at 3328–about 3% higher.

The 10 year treasury opened the week at 1.56% and closed the week at 1.56%, although it hit 1.65% mid week. Obviously the blowout employment numbers were outweighed by the corona virus and the slowing of wage growth in employment.

The Fed balance sheet grew by $15 billion last week–continuing a trend of less than expected stimulus. The balance sheet remains at levels equal to the end of December.

Last week we had 1 new income issue sold and that was from CLO holder Oxford Lane Capital (OXLC). The issue is trading on the OTC Grey Market now under ticker OXCPP and last traded at $24.81.

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$25/share preferreds and baby bonds remain strong with a weekly overall gain of 8 cents with investment grade preferreds being very strong with a weekly gain of 17 cents with banking preferreds garnering a 15 cent gain. Shipping preferreds were down 46 cents.

Below is the economic calendar for the coming week.

Delving Further Into Uhaul Investors Club–Corrected and Reposted.

RetiredBroker asked a great question earlier about the Uhaul Investors Club collateral and I wanted to get a note out to make sure we are clear on some important details.

The important detail – whether it is a small detail or a larger detail just depends on you the investor-is that the notes that Uhaul (Amerco) sells ARE guaranteed by the parent holding company Amerco (Uhaul)

It is noted that the notes ARE NOT guaranteed by the wholly owned subsidiary Uhaul.

Since Amerco holds 100% of Uhaul I am not certain that the lack of guarantee by subsidiary Uhaul makes any difference as long as the parent backs the notes.

So what you have is the secured property as collateral for the notes–and further backing the collateral is the holding company Amerco guarantee.

So this all means one should review the quarterly and annual reports of Amerco (Uhaul) if you are a holder of any of their notes.

We have a page devoted to the Uhaul Investors Club where we will add our information.

Thanks to RetiredBroker for asking the initial question on this topic thus stimulating a little deeper dive into the details.

Also to others who caught my errors and got things pointed in the right direction–Max and others.

Sliding Into the Weekend on Largest Gains This Year

Well we are heading into the weekend with very strong gains in the $25/share preferred stock and baby bond arena. After a strong December and a flattish January, big jumps in most sectors (not all) of the income issues have propelled us to a week which is up 12 cents in the overall $25/share marketplace with Banks up 21 cents and Investment Grade up 19 cents (through noon CST today).

Of course this means that anything I sold this week is now moving higher–oh well the story of a sellers life in the last few months.

I don’t track the shipping preferreds on this chart, but they are off a whopping 45 cents since last Friday. As some have discussed here the GasLog LTD (GLOG) and GasLog Partners (GLOP)issues have lead the way lower. Also there have been some ex-dividend dates playing into the lower prices.

Common stocks are down around 3/4% today in spite stellar employment numbers. Interest rates are in sync with the stock market and are off 6 basis point with the 10 year treasury trading at 1.58% right now.

A number of commentors have mentioned they believe, based on business experience, that the corona virus could turn out to be much worse than is currently reflected in the marketplace. I agree that there could well be something lurking out there which could depress GDP in the months ahead–BUT historically these have been a short term blip in markets–but we just don’t know and this is the problem. If we were to see a batch of confirmed cases in the U.S. (say a group of 50 or 100 cases) with social media and potential for ‘fake news’ there is no predicting where this could take markets–I have my eye on it, but really am not reacting in my investing in any way.

There has been some chatter on the website this week about some of the CLO (collateralized loan obligations) companies. This would include Oxford Lane, Eagle Point Credit, Priority Income, Oxford Square Credit, OFS credit and others. Many of these companies have term preferreds outstanding. I ran across a short article from 3 months ago that would be good to review if you are a newer investor to these securities. It is here.