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Just Energy and CBL Properties Cut Preferred Dividends-Updated

It has been a tough time for investors in the preferred stock of Canadian energy reseller Just Energy (JE) and mall owner CBL Properties (CBL).

While the preferred shares have been under pressure for some time it was only yesterday that both company’s announced suspension of their preferred stock dividends.

Just Energy has just 1 preferred issue outstanding which can be seen here. The issue had been trading around $16-$17/share last week and plunged yesterday to $9.80/share on the suspension announcement.

For what it is worth these shares are cumulative–thus dividends will continue to accrue. Of course whether they are ever paid probably is kind of a long shot, but speculators can determine that for themselves.

The Just Energy announcement can be read here.

Of course CBL Properties preferred stock had already seen tough times and the announcement was expected by many. CBL has 2 outstanding preferreds which can be seen here.

UPDATE

These shares which were already depressed trading around $10–per Ptrader they are trading much lower this morning.

The CBL issues are cumulative so dividends continue to accrue–again, whether they will ever be paid may be dicey.

The CBL announcement can be read here.

While very conservative investors such as myself are unlikely to have any interest in these preferred shares an opportunity may present itself for more adventuresome folks–only time will tell.

SVB Financial Group Prices New Preferred

SVB Financial Group (SIVB) has priced the previously announced new preferred stock offering.

The issue priced at 5.25% and will be non-cumulative, but qualified.

The issue is split investment grade with Moodys rating the issue Baa2 and S&P being at BB.

The issue will trade today under OTC Grey market ticker SIVBL.

The pricing term sheet can be seen here.

SteveA was right on the pricing under yesterdays announcement article.

Common Stocks Can Go Down?

For the 1st time today I looked at the stock market numbers at 11 a.m. (CST)–wow the DJIA is off 200 points. I didn’t know stocks ever fell–in particular 2 days in a row.

So just for the fun of it I turned on the TV (which I seldom do during the daytime anymore) and found 5 panelist on CNBC arguing about the market fall–each one of them was the smartest person in the room, at least that is what was conveyed.

Honestly while I don’t want to see a stock market crash, or even anything close to it, it would do all the smart people some good to see the equity markets take a nice 10% or even 20% setback – once we see that kind of a market we will at least have more of a clue who really knows what they are talking about.

Also a nice tumble in markets would separate the wheat from the chaff on Seeking Alpha where the never ending “recommendations” by some folks of total crap companies really grinds on me. With the ‘rising tide lifts all boats” market these folks are allowed to lead the sheep to slaughter. Not that there are not some good items on Seeking Alpha, but most of the most popular writers are legends in their own minds.

I concentrate on what I own–I watch interest rates and some potential causes of movement in the rates. I can’t say I get any ideas off of the TV and I get few ideas from Seeking Alpha–BUT I will admit to stealing ideas from the folks commenting around this website. I am only looking for a 6-7% annual return–I don’t need ideas from goofballs-and their are plenty of them out there.

SVB Financial Group to Sell Fixed Rate Preferred

California banking company SVB Financial Group (SVB) has announced a new issuance of fixed rate preferred stock.

The issue will be non-cumulative, but qualified and will have an early redemption period starting in February, 2025.

We find no rating for this new issue at this time from S&P, but it will be rated Baa2 by Moodys.

The issue will be traded on the NASDAQ once it trades on its permanent exchange under ticker SIVBP.

No OTC Grey Market ticker is yet known on the issue.

The preliminary prospectus can be found here.

2 Favorites to Be Called For Redemption

It looks like the Axis Capital 5.50% perpetual preferred (AXS-D) will be called soon (no official notice has yet been made).

Axis Specialty Finance LLC has announced a new $1000 Fixed-Rate Reset Junior Subordinated Note issue with the stated “use of proceeds” for “redemption of all of our outstanding 5.50% Series D preferred shares”.

This issue was one of the issues we owned as it traded right in the $25 area and had little to no call risk (i.e. money would not be lost on a call). It is now trading at $25.07 after going ex-dividend on 11/14 with a pay date of tomorrow. Assuming the call notice will give 30 days notice the accrued dividend should be in the 11-14 cent range meaning a value of $25.11 or 25.14.

Additionally Kimco Realty (KIM) has announced the redemption of the 5.50% KIM-J issue on 12/31/2019. We did not own this issue, but had studied it for a potential purchase. The issue will be redeemed at $25.29028 as it will have about 2.5 months of accrued dividends included as the last payment date was 10/15/2019. The notice is here.