Insurer/annuity company American Equity Investment Life (AEL) has priced the previously announced preferred issue.
The fixed-rate reset preferred will carry an initial 5.95% coupon until 12/1/2024. At this point it will reset to the 5 year treasury plus a spread of 4.322%. On each 5 year anniversary it will reset again.
The issue is rated BB (just below investment grade) by both S&P and Fitch.
We are still awaiting pricing on a number of previously announced new issues.
Insurance/annuity company American Equity Investment Life Holding Co (AEL) announced a new issue on Tuesday the 12th. This will be a fixed-rate reset preferred–non cumulative when it comes.
Global Ship Lease (GSL) announced a new baby bond yesterday. This will be a senior unsecured note with a maturity date in 2024–the company has indicated pricing in the 8% area.
Priority Income Fund (nontraded) filed a registration statement a couple of weeks ago indicating a potential new term preferred would be coming. Typically Priority announces these and then it takes 3-4 weeks before we see anything firm on an actual sale. Given that they have 5 issues outstanding whether they sell another new issue is of little consequence to me–I have a little taste of the PRIF-D 7% issue already.
We will post as soon as further info becomes available.
Nomadicmist reminded us today, on the Sandbox Page, that while the stock market continues to ‘party on’ there is plenty to worry about in the world.
Nomad points to the recent downgrade of the Global Sovereign Outlook to NEGATIVE by Moodys for 2020. Essentially Moodys has been downgrading a number of countries lately and doesn’t see the economic outlook improving–and maybe getting worse in the year ahead.
Compass Diversified Holdings (CODI) has priced the previously announced preferred.
The issue was priced at 7.875%, with 4 million shares being sold, with another 600,000 being available for over allotments. This issue will issue a K-1 at tax time.
I had originally thought this issue might be interesting, with a possibility that I might want a small position. But upon further review of the currently outstanding CODI preferreds I see no reason to rush into any purchase–CODI issues trade weakly.
The issue will trade immediately on the OTC Grey market under temporary ticker CMPSP.
Container ship lessor Global Ship Lease (GSL) will be selling a new Senior Unsecured Note with a maturity date in 2024.
These $25 notes will have bonuses for early redemption. They will be redeemable on and after 12/31/2021 up until 12/30/2022 for 102% plus accrued interest. Then redeemable on 12/31/2022 until 12/30/2023 for 101% plus accrued interest. Additionally they may redeem the notes anytime prior to 12/31/2021 for 104% plus accrued interest.
I do not find a current credit rating on this issue, but Standard and Poors did recently raise the companies rating on some other notes to B+.
American Equity Investment Life Holding Company (AEL) has announced a new $25 preferred issue.
This is another Fixed-Rate Reset issue, which means it will have an initial fixed rate until 12/1/2024 at which time the company can optionally redeem the issue–or reset the coupon based upon the 5 year treasury plus a “spread”.
There after as long as the issue is outstanding the coupon will be reset every 5 years at the 5 year treasury plus the “spread).
The issue will be non-cumulative, but should be qualifed. The permanent ticker will be AEL-A once trading begins on the NYSE.
The issue will trade on the OTC Grey market, but the temporary ticker has not been announced yet.
While we don’t cover $1,000/shares issues it is noted that Goldman Sachs (GS) will sell a new preferred.
This is a Fixed-Rate Reset preferred. This is interesting as we have seen a number of Fixed-Rate Reset preferreds this year.
The way the fixed-rate reset issues work is that they will have a fixed rate for a number of years (in this case until 2/2025) after which it will reset every 5 years at the 5 year treasury rate, plus a fixed spread.
Currently there are no plans by the company to list this issue.
Financial services firm Ladenburg Thalmann (LTS) has announced a merger with Advisor Group. The deal supposedly will close during the 1st 1/2 of 2020.
Yesterday in the comments under “Ladenburg Thalmann Announces Earnings”, 2 whiteroses posted a Barrons article on this particular possibility and folks discussed it further. Last night Nomad picked up the formal announcement during the evening
Currently we do not own any of this issue and whether it is good or bad–??–everyone probably has an opinion.
The S&P500 traded in a range of 3065 to 3097 before closing around 3093–a gain of just less than 1%. At this time all news is good news–at least this is what equity markets indicate—party on I guess.
The 10 year treasury traded in a range of 1.75% to 1.97% before closing at 1.93%. We have seen rising rates knock preferreds and baby bonds down a bit so it will be interesting to watch rates this week. Every year, for the last 4 years, we have seen income issues sell off hard at some point between November and February so it wouldn’t be surprising to see that happen again–maybe we will get a chance to buy some quality issues at lower prices.
The Federal Reserve balance sheet grew again last week, this time by a hefty $20 billion–the balance sheet is now solidly over $4 trillion–$300 billion higher in the last 10 weeks.
Last week we had 4 new income issues.
Insurer Allstate (ALL) priced a new non cumulative perpetual preferred with a paltry 4.75% coupon. The issue is trading under the OTC Grey market ticker ASTLZ. The issue closed the week at $24.77. The issue is investment grade.
Storage giant Public Storage (PSA) sold a new issue of cumulative, perpetual preferred stock with a 4.70% coupon. The issue is trading under the OTC temporary ticker of PBLSZ and closed on Friday at $24.83. PSA preferreds are the highest rated preferreds available with a A3 rating from Moodys and BBB+ from S&P.
SynchronyFinancial (SYF) sold a non cumulative preferred issue with a coupon of 5.625%. Now trading under OTC Grey market ticker SNFI the closing price last Friday was $25.03.
CIT Group (CIT) sold an issue of non cumulative preferred stock with a coupon of 5.625%. The B+ (junk) rated issue closed last week at $24.93.
Unlike previous new issue the current batch are having trouble gaining traction–if interest rates hang in the 1.90% area we likely won’t see too much movement upward in the low coupon issues. Remember, while stocks will trade on Monday, bond markets will be closed.
I see that Chad has been making some changes this morning–we had met yesterday for discussion on some changes. To see the changes you may have to clear your cache.
Some changes are not meaningful to functionality (such as the blue colors instead of green), while others are changes that I hope help the function.
You will see that when I post a link now most of them should show up underlined – like websites of old. The problem I had before is I could only bold a link–then you couldn’t tell if it was a link or simply something that needed emphasis and thus was bold.
Some other changes you will see are on the security detail page—here. Chad will add a ‘variable’ option under the ‘qualified’ box–this will be helpful for the CEF preferreds for instance which are may be qualifed or not.
Additionally we will add a 1009/K-1 box on the security page–just to clarify.
There will be other changes–but I won’t mention them, because maybe they aren’t even possible–sometimes I want changes that can’t be done (old sucker that I am).