American Finance Trust Prices Perpetual Preferred–UPDATE TICKER


REIT American Finance Trust (NASDAQ:AFIN) has priced a new issue of perpetual preferred stock with a fixed rate coupon of 7.50%.

The issue will have an early redemption period starting on 3/26/2024. There will be 1.2 million shares sold with another 180,000 available for over allotment.

The pricing term sheet can be read here.

The anticipated permanent ticker is AFINP. No OTC Grey market ticker has been announced, but we would anticipate one before the end of the today.

6 thoughts on “American Finance Trust Prices Perpetual Preferred–UPDATE TICKER”

  1. When a company doesn’t cover it’s dividend, i don’t invest in it. But I can see the allure of this investment as we all want some high yield candy in our investments.

  2. This issue is off to a weak start trading at $24.35. Of course I jumped the gun and bought 200 @ $24.60 (high of the day). I might look to add another 200 after I see where the issue settles

    1. Fred, I ‘m a REIT investor junkie and may pick up a few shares tomorrow.
      The company has pretty bad interest rate coverage of about 2.25x, but the debt to cost of the real estate is about 38% ( not including depreciation) – so the issue is not complete trash, but earnings for the company should be watched closely as this one is higher risk..

  3. I always look at several things in a series of steps. Step 1, is to look at common stock. It if is unhealthy, some cause is probably right around the corner. In this day of age of record breaking index returns, why is the common going down? Not a good sign. Don’t have to look further to see other signs of issues.

    1. For income investors, dividends may be a more relevant metric to monitor than the fluctuating common share price. Are common dividends growing, static, or decreasing? Does the company generate enough cash from operations to cover their dividend payouts and debt obligations? Will they continue to be able to do so in the future?

  4. Tim, this company is new to me as I follow the REIT sector pretty well. SunTrust has 9% of their properties leased and they will be merging with BB&T over the next few months – so potential for closing of locations, but I don’t know the terms of the leases. However, a good starting point to do some further research.

    Thanks for the tip on the new preferred

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