Common Stock Chat

This page is set up for those that want to chat about various common stocks.

There are no rules–other than the usual–no politics.

212 thoughts on “Common Stock Chat”

  1. Looking for “relatively” safe places to earn a decent return I took a look at some merger-arb ideas. Two interesting ones turned up:
    MSFT buying NUAN for $56 cash, currently trading at $53.18 gives a 5.30% return till expected 4th Qtr completion.
    LMT buying AJRD for $51 cash, currently trading at $48.50 gives a 5.00% return till expected 4th Qtr completion.
    Obviously there is always risk deal falls through or is extended, but these two looked attractive to me.

    1. Chris – In this area of pure arbitrage, if looking to participate while minimizing the specific issue risk of trying to pick individual situations on your own, have you looked at funds like MERFX or GABCX who focus specifically on this area? You won’t get 5% but then again, the risks of timing properly and avoiding individual deals falling apart is left in the hands of the pros.

        1. I just looked up MERFX on TDA. Under “trailing total returns”, if I am understanding the information correctly, (I am assuming the “TR” behind S&P 500 means total returns) then an S&P index fund would have vastly outperformed MERFX over all time periods. I think I’d just stash money in VOO or VTSAX or similar. In fact I do have some money there…..

          It seems a tough place to make money, even for the professionals, because once the info becomes public, the market has already reacted and all the arb value is gone. I just saw that with the O / VER merger. Someone’s probably making money on it…. Early investors and VC’s I guess, but even MERFX doesn’t seem to be knocking it out of the ballpark and this is what they do for a living.

          Or, am I missing something?

          1. Mark – Let me ask you a couple of rhetorical questions…. #1, Would you be willing to put your “safe” money into an index fund even though they have outperformed practically every other category of fund over the years? #2. Is there a place in this world for money market funds or alternatives to them? Certainly you won’t find a single money market fund competing performance wise with an S&P Index fund, yet there sure is a whole lot of money sloshing around in them… There must be a raison d’être for trillions hanging out in money market funds even though they too can’t hold up vis a vis your comparison standard.

            The point is MERFX is not designed to be a performance fund… It’s to provide steady, reliable gains that surpass what you can earn in a money market fund or its equivalent.. An Index fund is great and certainly outperforms so many other categories of funds as to be embarrassing to the fund industry as a whole, but still, if the market goes down 20% your Index fund will too… An MERFX will not…. some of we belts and suspenders types like that kind of thing…… The bottom line is a comparison of MERFX to an S&P Index fund is an apples to oranges one… They are not designed to do the same thing. it’s a Safety Joe Fund – https://www.youtube.com/watch?v=_RTScRTFGvY

            1. Very funny…..I’m not sure what I was expecting Safety Joe to be but John Prine wasn’t even under consideration. I noticed he died of the CoronaVirus of all things.
              But back to your rhetorical question two….like many people I have a fair amount of cash sitting in Money Market accounts earning nothing. That I
              ‘m on this blog is also an indicator that I own Preferreds, ETFs, Dividend Paying Stocks, Canadian Rate Resets and Corporate Bonds. But I’m still 40% cash. I do it for safety because there is nothing about America that inspires confidence at any level. But I’m curious….is there any other possible reason that you’ve come across?

    2. Was just looking at the announcement and saw something that concerns me (although I may not properly understand it.

      “As part of the transaction, Aerojet Rocketdyne declared a $5.00 per share pre-closing special dividend to holders of its common shares and convertible senior notes, on an as-converted basis. The special dividend will be paid on March 24, 2021, to holders of record as of March 10, 2021. The payment of this special dividend, unless revoked, will adjust the consideration to be paid by Lockheed Martin to $51.00 per share at closing.”

      Does this mean if the special dividend is paid (which it was), that LMT will adjust their $51 offer? Again – I am probably misinterpreting this but wanted to raise it up.

  2. AGNC the big REIT has been making highs of late and just reported earlier today with a beat making further new highs in AH. It pays dividend monthly and goes ex-divd 4/29 and yields over 8%.

    Took a position in the common via a BuyWrite – this enhances the yield to over 10%. Perhaps a better buy to do this instead of buying its 6.125 or 6.5% coupon preferreds? Aim to keep selling in-the-money calls till assigned, especially around the monthly ex-dividend dates…

    1. mSquare – Seems like a lot of work as you need to write the call several times per mo for like $1-$2ea, with the risk that shares will either be assigned, or even worse, they aren’t assigned, and the underlying share price gradually deteriorates so the CC’s and divies are merely chasing your cost basis. Then you’re in the awkward position of having to write a covered call at a strike that is less than your cost basis for the shares. Furthermore, you’ve probably noticed that the bids tend to evaporate for a strike more than $0.50 above the current share price with the AGNC option chain.

      If you’re looking for 10% from commons in this sector, why not just buy NLY common?

  3. I opened a position recently in VERX. It’s a company that makes sales tax software who IPO’d last year. About half of the Fortune 500 use Vertex’s software. It’s quite an effort to change software providers so it’s rather sticky. Just curious if others here have looked into it.

  4. I recommended VIAC here last year in the mid 20s. It’s now approaching 100. No, I don’t hold it anymore….I sold way too soon. Believe it is roaring because of excitement over the new streaming service….Paramount Plus. I wouldn’t touch the stock here. I’m sure subscriptions are doing very well, but I believe that is due in large part because the service is being heavily discounted or even given away. Checking an entertainment board I frequent confirms this; also that customer service is difficult to reach.

    The tell on this stock will be when the company announces spectacular subscription growth but suspiciously low revenue and earnings.

  5. For those of us who are too stupid to realize that it’s different this time and stocks only move in one direction, here’s an interesting chart of historical P/E ratios for the S&P…… no reason for concern, though, everything’s as rosy as can be… https://www.multpl.com/s-p-500-pe-ratio

    1. I find it interesting, too, that all the wildest gyrations have been in the last 25 years.
      When did MMT / QE become the fashionable monetary theory? When did retail trading become popular? When did the internet really become ‘a thing’?
      Is it natural that the P/E should rise as the money supply increases?
      Should this be used as another gauge for inflation?
      Just thinking out loud.

      1. It’s pretty transparent: It’s a fact that this is a social democratic institutional maneuver, ALL parties and political minds have been complicit since Reagan…corporate is still seen as the method of management and distribution for the mechanism…the plebs just get an occasional check to feed corporate trickle down. Don’t worry, Everything is VERY EASY to manage.
        Since we are in the common stock area, I have had at least ten issues hit high sell limits and/or get called; one in Canada and I am thinking two more there soon. What to do with the cash? I had pivoted toward accenting cash on cash returns with cash covered puts on exhausted quality stocks (TOT, BMY here?) and this is getting tougher off the March lows, will end too and rolling close calls with managing divs on those owned. EPD is going to be interesting here since it goes xdiv Thursday and option expire on Friday….very close on my strike. Really, I DO NOT need the excitement or drama, but am just responding with tools I know. My Roth is crowded. and I DO NOT really like the risk. Seems this is like the 60’s?, grind off the residual debt from WW2 on a new generation, but at a much higher valuation and overall debt level.

      1. My guess is U2 WILL probably be next to sponsor a SPAC – if they haven’t already… lol

  6. Fastly (NYSE:FSLY) has priced $825M of 0% Convertible Senior Notes due 2026 in a private placement. The offering size was increased from $750M.

    The initial conversion rate is 9.7272 common shares per $1,000 principal amount of notes (~$102.80/share).

    FSLY currently trades at $67. Holders must be crazy bullish on this 0% note.

  7. NEE (Nextera) took a pretty big hit yesterday, at one point dropping just below $73. Part of the explanation is that now that the herd is risk on again that there is a sector rotation out of Utilities and into Finance and other areas. And then there is the issue of rising rates.
    I’m wondering if this rotation away from Utilities is a buying opportunity for Income Investors for solid, reasonably “Green” companies like NEE or AEP?

    1. I strictly follow the yields on my utility portfolio. As soon as the price drops enough to create an attractive yield I add. For example when DUK drops so that the yield heads above 4.5% I add. I have yield targets for DUK, SO, PPL, EIX etc.

      1. Don’t forget those higher short term yield convertables if you are cool holding the commons down the road. They are structured leap call options if held for non-trading. I had two snipped off with sell limits at recent highs after a couple divs: SO, D still have the AEP. I think there are a few more? They are being chased too.

  8. Anyone follow CRT, Cross Timbers Royalty Trust? It is purely a holder of oil and gas royalties. I’m thinking if oil and gas keep going up, this would be a direct beneficiary. Thanks!

    1. Want an interesting view on Am Royalties check out MNRL, decent management and focused on royalty sharing with equity. Best of the bunch in US in my opinion after researching them all. Do not own tho.
      I have owned two CNs royalty companies in my “sock-drawer” only payers for a very long time: FRHLF and PREKF, that are also available on US OTC. The fun part for me recently was that the confidence in their models and management (read: no hot rods) during the last year saw a HUGE price down and some prudent divy adjustment, but they kept paying, boom, boom, boom. I added a scant averaging down in the oil nadir last year. Now they have both reasserted strongly, are way in the green for me and I expect div increases back to their previous payout…or who knows maybe more. Just stayed with the plan. They use a payout ratio which is tied to oil prices realized, true royalties. Worth a look.
      Years ago, the Ontario Pension System tried to buy all of Freehold and that is when I began DD into these companies. Me love this method of their business models which need to be understood.

    2. CRT will benefit more if oil prices rise enough to overcome their share of operational costs (and deficit) in the 75% tier TX & OK acreage. However, I like SBR and DMLP much better. I personally don’t view MNRL as a comp for any of these.

      1. I would love to hear more about why you don’t think MNRL is a comp. I listened to the conf call and have reviewed their materials and bought some. I guess more importantly is your thought on those companies and the royalty play idea. Thanks!

  9. One of the people I follow is Michael Burry, he of Big Short fame. Because of the size of his holding he is required to file 13Fs each quarter. I would describe him as a value-based short/medium term equity trader. He does with equities what I think a lot of people here do with fixed income.

    Interesting, to me, to see what he moves in to and out of each month:

    https://www.sec.gov/Archives/edgar/data/1649339/000156761921003819/xslForm13F_X01/form13fInfoTable.xml

    I especially like the move into CoreCivic, as I did the same both on the debt and the common (through cash secured puts). There are lots of familiar names on the list.

    The inherent limitations on the data are 1) it’s 45 days old when published, so it’s yesterday’s news, and 2) short positions are not disclosed. But still, you can get a lot of insights into the thinking and methodology of a very savvy investor.

    The portfolio is concentrated enough to add some meaningful alpha but diversified enough that he isn’t crushed by one bad call. Like some of the jokers in the hedge fund business. I believe Burry is playing with his own money here.

  10. I was hoping to put this in the UHaul section as another possible alternative investment type vehicle, but that’s closed so this is the closest I can figure to be a near relevant area for this oddity:

    Every now and then I check out The Royalty Exchange just out of curiosity – https://auctions.royaltyexchange.com/overview. I was wondering whether or not anyone here has ever had any real time experience with this? It’s a site where you bid on specified future royalties to come from music or movies publishing or performanc rights, etc… I wonder if one were to win one of these, is it as simple as just sitting back and letting the royalties flow in or does one have to be proactive in marketing what you’ve bot once you’ve bot it in order to be successful… for example, right now you can bid on rights for royalties from The Doobie Bros song, “Black Water.” It’s all’s spelled out in detail, but I wonder if John Q Public, who’s not a music insider, has a prayer of getting treated fairly if he owned any of these type rights? Great cocktail party conversation starter either way though, I suppose…. Can you really be the next Paul McCartney via this route? McCartney probably makes more from the various music rights he owns under his MPL Communications umbrella company than he does from the music he’s making these days.. https://www.mplcommunications.com/

    Here’s the Doobie’s info https://auctions.royaltyexchange.com/auctions/the-doobie-brothers-black-water-more/?origin=overview&filter_value=overview#Overview
    Yeah, I know far far off normal topics, but maybe it’s another UHaul type thing to do in a way….. kind of fun too..

    1. 2wr – I’ve not looked at that website but there are a number of music royalty companies out there some being quite large.

      Check out Round Hill Music Royalty Fund.

      1. Thanks, Bob – I’ll take a look…….. I’m not sure my interest is beyond curiosity but it’s worth investigating… Music is such an interest of mine I might as well check out income stream avenues within…

  11. JMP, Thank You Insider Cow for that.
    Insider Cow is a web site that lists all insider buys and sells.
    I have been playing stocks based on that strategy for many years.
    Alas, I don’t hold for long.
    I just my last shares of JMP 7:57 AM EST at 11.00 . (Bought Feb 2nd)
    SPLP also has steady Insider buys, but I bought preferred instead of common and that was a mistake. I will buy the common today because I see a Cup forming and hope the handle is way higher.

  12. Devon Energy — DVN
    I’ve been on a contrary streak lately, and even though the energy sector has fallen on hard times and is not much loved these days, I think there may be some opportunities here. One such opportunity is Devon Energy. DVN has recently completed it’s merger-of-equals with WPX Energy and the combined company appears to be on solid financial footing. What I like is the fact the company reports they can break even at $33 WTI and with oil trading around the $60/barrel mark DVN has plenty of upside IMO. So much so, they just declared a variable dividend of .19/share on top of the regular, fixed .11/share dividend, both payable 03/31 to share owners as of 3/15.
    Here is a link to a PowerPoint presentation outlining the company’s position and outlook.
    https://s2.q4cdn.com/462548525/files/doc_presentations/2020/DVN-WPX-Strategic-Merger-of-Equals_Presentation_092820.pdf.
    I invite your comments and observations.

    1. DVN has a history of chasing trends and not having the balance sheet to take advantage.

      This has allowed activist investors to take over.

    2. I’ve been in and out of several energy producers over the years, including the shales. I’ve made money on some and lost on others. Seems the totally uncontrollable factor remains OPEC. Despite a lot of discussion of OPEC being dead or nearly so, the Saudis can open or close the spigot at any time and it will affect your investment. With oil over $60 a barrel, it’s just a matter of time before the Saudis begin pumping more. Plus, DVN has had a heck of a run in the last six months.

  13. Any idea why CNIG is dropping so much today. Not a huge amount, but for being bought out a little surprising.

  14. Softbank (SFTBY) is up 8% today. Was it the increase in profits or was it that Softbank and Microsoft was mentioned in the same sentence in a headline? It doesn’t take much in this market to get stocks to pop or drop.
    Softbank invests in and sells new technology companies regularly. Winners exceed losers so It’s worked out in this technology growth market. Surprising to me is that it has a small dividend of about .5%. The CEO, Masayoshi Son, is an interesting guy and aggressive so I took a chance with a small investment that resulted in a 145% gain. At times there is negative press when some of its holding like Weworks has problems but those losses are covered by major profits with other companies. There’s growth potential in the investments it makes and it remains aggressive so I’ll hold and hope for the best. It’s hard to judge the value since they are constantly investing and selling.

  15. The proxy voting instructions I received for one of my holdings allows only a “For” or “Abstain” vote for the slate of Directors. Always in the past, I have been allowed to vote “Against” nominated Directors. I’ve never seen only choices “For” and “Abstain”. This is one time when I really do want to vote against all the directors, so it pisses me off that there’s no “Against” option, and just seems typical of this crowd of criminals.

    Anyone else seen this before?

    1. Do you own enough shares for it to make a difference? If not, I’d worry about something more pressing in my life.

      Also, why continue to hold shares in a firm run by what you discern to be a ‘crowd of criminals?’

      JMO

    2. Many people abstain by not casting a vote at all, and one really can’t know if these individuals are just lazy/indifferent or if they oppose management. If you actually vote “Abstain”, you are clearly opposing the Directors.

    3. camroc, I’ve asked myself the same question and yes it’s past time to exit.

      af, thanks for the thoughts.

      Bob, thanks for the humour.

  16. RSS Feed –

    Just testing…. sorry but haven’t seen anything in past 3 hours…….that seems out of the ordinary.

  17. Thank you all for the wonderful education that you have given me , a lurker, for quite some time. I have been on this website a lot more of late due to the pandemic, so I thought I should come out of the shadows. I wanted to make sure that I was looking at CNIG correctly, since Grid has brought it up recently and since I have made a decent sized purchase. If I were to purchase more today at $23.75, I would receive $24.75 when the deal closes in the 2nd half of 2021, plus any dividends paid during that time, correct? Seems like a no brainer. Is there a likely chance of the deal with Argo Infrastructure not happening? Is there anything else that I am missing? Thanks again to all of you for the great education!

    1. Hey JTS, I bought a bunch of CNIGP which is the 1 preferred to 1.2 common stock convertible at $27.
      That makes the redemption cash in of it worth of $29.70. Im just sitting on mine….Your not missing anything. But these tend to sit where they are at waiting for approval. The market is going to give you a small bone here until merger is complete. However, you are taking the ~30% haircut risk if it doesnt go through…For whatever reason that may come upon.
      CNIG isnt going to retract as the “6 unit team” that owns well over half and is aged (along with Gabelli thrown in) already said yes over a few martini’s. But many unforeseen risks can occur thus why it sits below merger price.
      I can list several easy reasons why this will go through, but the unforeseen and regulatory angst if any, I have no idea which is the key in the end. Plus it could drag out longer than planned which ultimately shaves annual return down also. …. Its now just a modified version of picking up nickels in front of a steam roller… Keep your head up when bending over!

      1. Thanks Grid, that makes sense. I’ll sit tight with what I have and find other opportunities in the meantime.

      2. Grid, concerning CNIGP – when merger completes, does that mean our CNIGP shares get transformed into CNIG common stock at a rate of 1.2 shares for every CNIGP held?

        And if so, would we be able to sell on the open market, or will those shares be changed to those of the merging company?

        1. No, according to filings they get cancelled and pay $29.70. Just like the common gets cancelled at its buyout price (cant remember off top of my head what it is). But they all are getting cancelled as there is nothing to convert too since a private company would be taking it over.

          1. Thanks, so we will be getting cash of $29.70, plus any accrued dividends. Correct?

            Merger is supposed to complete in second half of 2021. I will sit tight on CNIGP until then.

            1. Yes, that is the plan…But… It involves two separate state regulatory agencies and one is NY. I dont know if their wheels are well oiled to move fast now. So these things drag out…Remember Exelon and PEPCO merger and how it dragged on and on and was cancelled and then on again? Oh and the painful part for us both…When we bailed on PEPCO the day before because it wasnt going through and PEPCO was going to drop like a rock?
              We lost our investing testosterone 24 hours before pay dirt and it cost us both a 30% windfall. You have probably got over it, but it still burns my rear.

              1. Wow, PEPCO – you did bring up a long forgotten event. Yes, it was painful at that time, but like you correctly said, I have moved on.

                Sure hope that this merger will go through and be complete as they say.

    2. JTS – Welcome to the wonderful world of low risk merger arbitrage because that’s what you’re looking at re- CNIG. Grid’s mentioned Gabelli on this one and they are big players in the field though from what Grid’s said, I think they were in CNIG before the buyout surfaced… What you’re doing is weighing the odds of the deal closing at 24.75 and/or closing on schedule and then deciding whether or not that’s worth the wait to get that price then or sell today at 23.75. That’s a pretty simple yield to hold date calculation if you throw in a guesstimate for actual closing date. Eyeballing it, I suspect a hold is a pretty good deal, especially with the risks of closing probably being quite low

      BTW, true merger arbitrage would include playing with vehicles that minimize the risks of the deal falling thru.. Simplest example would be when one public company buys another, the arbitrageur would buy the company being bot and sell the shares of the issuer based on complicated proprietary formulae they create…. People like MERFX and GABCX specialize in this and in general, they offer a pretty safe bet for steady but low yields, good places nowadays to use as money market rate alternatives..

    1. I’ve been hitting those points on message boards and the response is hilarious. ‘Take up the pitchforks’ …”you must be a hedge fund guy”. “You must be short”…..psst I’m a long only investor!! Without being able to understand its Institution vs Institution. The tape proves it. Just look at GME biggest shareholder starting with…..FIDELITY. Is fidelity a reddit trader with robinhood trading accounts?

      The stock hit 2.50. It had 4 dollars in losses. **NEWS FLASH** kids download their fortnight games. And they have Amazon walmart and TGT as options too.

  18. So the soundbite of the day, week, month, and year is GME. My thoughts are

    1. Short squeeze has elevated their shares so high as to give them a new shot at shoring up their insolvent balance sheet
    2. The only people hurt were short so who cares
    3. The way margin trading acts work it’s not naked shorts that pushed the short interest over 100%…and see #2
    4. The trading volume in dollars of the top 15 shorts for last 4days exceeds 200 billion, no way is the majority of that retail day trader
    5. Reports that’s it’s all robin hood and retail traders are lying or actually too stupid to know (which is more dangerous!) that’s its institutional vs institutional trading
    6. Doesn’t anybody care to report this fact; there may be 140% short common shares, but offset by 141% long option positions.

    Shorting was first done in year 1602. This is not a new concept, and none care to even report how a cash/margin account/short margin accounts work

  19. I had a few of stocks hit my “buy” level today (keep in mind I’m a buy and hold dividend investor).

    WPC, PFE, EIX, NNN, HIW, BFS

    Not a lot of dry powder at the moment though so simply noting them.

    1. Any reason for liking EIX more than some others? I’m losing PNM this year on a “merger” which is really a buyout since we only get cash. So really looking for some good utilities to put that back into. I voted no on the merger since my purchase yields range from 8-14% so I’m trying not to chase yield to make up the loss but rather hoping to find one raising divs consistently.

      1. My utility watchlist includes D, EVRG, and PNW. I am also looking at VZ. The “California” risk keeps me disinterested in EIX, however the additional risk does appear to be already discounted.
        I strongly believe that the increased usage of EVs is an underappreciated catalyst for the electric utility sector.

      2. RE EIX – Morningstar has a fair value of 69, pays 4.6% and has a 16 year dividend track record so checks a lot of boxes for me. I also own DUK, SO, PNW (also a buy I think).

        There is the wildfire risk of course and I expect that’ s why there is a slight discount.

        1. Bill and af,
          SO has the two year converable SOLN also if you are good holding that Util even after conversion to common as a worst case scenario. Paying about 6.8% for about two years. Decent and fair conversion clause.
          There are a couple other big utils, D/DCUE and I forget the other one, with similar short term converts, but understand the conversion features if the stocks are down at the time of conversion with a conversion to common and that div…if there is one.

          1. Joel – I looked into SOLN as that 6.75% yield and selling sub 50 was enticing. Looking at the charts it appears that the price of the this preferred follows the price of SO very closely. (I ran them side by side). I take this to mean that the value of the shares at conversion is affected by the value of the SO common shares at the same time.

            Am I correct that one is essentially making a bet on the value of SO if you hold this to mandatory conversion? In particular, below that lower limit of $57.20 for SO share price in seems one starts to lose ground in the principle returned to you.

            I am new at mandatory convertibles so this is of interest to me. Thanks for any clarification/guidance you or anyone else can provide.

            1. Bill, You basically got it figured out. These are equity units and ultimately are just a bet on the common stock with a slight yield tease thrown in for playing.
              These typically are “stall tactic” shares issued for company to grow its earnings into some type of recent or near future digestive purchase or capital expense before converting the equity dilution.
              Since you are new to these, remember they will not trade independently like a preferred stock, they are in bed with and tethered largely throughout the process with the common stock.

        2. BillW,
          Having grown up in Southern Cal and now living in the North I have lived through 2 wildfires and talked to many of my customers throughout Northern and Southern Cal.
          Outside the risk of Santa Ana winds I am comfortable holding SCE-PH
          Look at it this way, I have no desire to hold SO because I think of the destruction from hurricanes that happen almost every year now.
          So no different in my view from Calif and the wildfires.

    2. BillW

      Of your names I like WPC, PFE, NNN. I agree with af below that CA fires are concerning for EIX. That’s why I don’t hold the SCE trusts(?). With BFS I’m more comfortable holding the PFD (BFS-E).

      Given where the market is, I think purchasing stock-as-bond income is best where one has lots of dry powder to continue to scale into these as they drop. And pick dividend champions, as you don’t want to continue scaling in on an equity and then have the divie cut.

      Another thought if your cash is limited is just pick T, MO (if you’re okay with it), EPD or MMP at their current rate, and don’t look back. You’re getting 7-9%, and let the stock price be a concern of the estate.

      1. WPC is the only common stock I presently own, I am using it more as a preferred stock replacement. It kind of moves around a lot frequently in a days time. So I have day traded it several times. And its a good thing I have as the trading has got my cost basis barely below present price. Without trading, I would be several bucks underwater in total, not counting the dividend. Jan 1, 2013 it was a $67 a share stock, albeit with a 66 quarterly dividend, now its still right around that price with an almost $1.05 quarterly. One can always pick their comparison price point, I get, but its more of a slow dividend growth play than anything.

        1. Same happens with me with EPD. I buy a chunk with the intention to hold for years, but then it rises 8%, and I’m like “why wait the whole yr for the 9% divie, just take the profit now.”
          But then FOMO pops up so I immediately buy a quarter lot, in case it goes up. I scale in as it drops, then it pops 7%, and it’s like “why wait for the divie”? Rinse and repeat as “someone” said.
          I’m a “recovered” FX and minis trader who had to “sober up” in longer-dated senior debt for years to get my life back. So I am not looking to trade: 4-5% makes me very happy. But you hold dozens of these PFDs and quality high-yield equity positions, scan your ‘unrealized gains,’ and you’re up generously in a position – you gotta take it and buy something else. That “something else” in equities is a much smaller group – and I agree WPC is one at the current 6.30% (not a “champ” but a “contender” with 24 yrs – good enough). On the other hand there are dozens of decent holdings in the PFD sector with their sober 0.5 betas.
          It’s a weirdly easy market to make money in – almost makes you feel uneasy. The Fed has a floor under this thing like never before.

      2. Yep have T, EPD, and MMP in the mix. Long term holds for now.

        My common stock portfolio is averaging 4.3% which I’m OK with. Have blue chips like JNJ, PEP, MMM Etc bringing the average down vs the above.

        Lately have been buying REITS in the IRA. WPC among others.

      1. There is merit (no pun intended) in buying the most non ESG companies out there. All they do is make money.

        Every time I see hate directed at a company or industry I look at selling puts. All those nervous holders wanting to get out! Making yourself out to be an insurance company can be profitable.

  20. Hello Fellow Investors…
    I love this site – its’ a breath of fresh air. Thank you!!

    Still, I’m not a trader at heart and don’t really want to manage 20+ stocks or bonds. Nearing retirement and want to get more in the income area, and don’t mind putting some $ away in leverged income CEFs – put away and forget. Any med risks tolerance recommendations? e.g. CGO, JPS, RCS, RFI, etc…Gamestop of course! 🙂
    All the best!

    1. Ricks- Put the Flaherty & Crumrine Preferreds on the list as well. FFC and a few others. I don’t own any now but when I did I liked them over the others in the category. Great long term track record. All are too expensive now but when the market turns these get killed and a great time to buy. As long as you wait to buy and don’t get spooked by the volatility. They can be a good piece of your portfolio. I

      1. I 2nd FFC as long as you wait for a crash to buy. These can drop 20% in the blink of an eye, that being 3 years worth of distributions. Sitting in cash to buy at 20% under present price is not bad.

        PS – FFC dropped 60% in March, so such moves are possible.

        1. Is continuing to hold it when it’s as high as it is now a bad idea after buying in the crash?

        2. I actually own FFC and plan to get more with the next correction. Probably one of the best CEFs in my research, too. Agreed: Everything is pricey right now, and I would not buy more until we get some better prices/NAVs. I bought a lot of NOBL in March – got lucky and did well. Would do it again with a good panic (I love those times).

          Thanks again – helped confirm some of my bet/strategies. Good Luck!

          1. I like FFC and have a marker holding of only 25 shares just to keep it in front of my face to watch for buying opportunities. Monthly payout of just under 7% at current high price is good reason for me to pick up more, its rated 5-Star by Morningstar. Plan to add more when it gets closer to the 3-year prem/disc average.

          2. RickS, you might take a look at BIF it’s got a big tilt to Berkshire Hathaway but has a dividend kicker, also a large discount to nav.

        3. Bob,
          I looked over on SA and read a article on these funds. One comment struck me as interesting, But the person didn’t provide proof
          “they were all able to take advantage of drops in the short-term rate and, by virtue of being private agreements, they are out of scope of the 1940 Act asset coverage rules making them less liable for a chance of deleveraging.” Would appreciate an explanation of this why / how they were able to avoid deleveraging when prices plummeted in March like so many other funds did

          1. FFC does not use preferred or bonds with covenants to fund leverage. The 1940s act states 200% asset coverage required.

            When large drops in price happen to CEF funds the asset coverage ratio goes down. Causing funds to sell at the lows of the market locking in losses.

            1. Micahc, Thank you, I like simple easy to understand. Other CEF’s are leveraged so have to issue more shares or preferred or sell assets to raise cash to bring coverage ratio back in line in time of a crash. FFC doesn’t

  21. Gift from Heaven. Proving once again that it’s infinitely better to be lucky than good, I submit the following tale. B&G Foods, BGS, is a sleepy food processing and distributing company whose management has apparently been involved in some sort of empire building by buying up other companies in related fields. This has left the company with a big pile of debt. Sales and earnings have never been that good until the Covid pandemic hit and, apparently, people started shopping at their supermarket and cooking at home. That caught my attention, and figuring that this trend would last until at least early 2022, I impulsively bought a few hundred shares motivated by what at that time was a juicy 6.7% divi. I did not check what percentage of the shares had been sold short. (I know, I know. Maybe I’m not that conservative an investor). But apparently it was a lot of shares, as this stock has simply exploded upwards in the last 3 trading sessions with absolutely no news. What I paid $27 for I sold today for $43. Maybe I should have waited, might go to $100.

    1. As the Gamestop Reddit kiddies blow up a couple hedge funds, seeing this type of action in a number of stocks. the Hedge Funds that were short GME had to cover and had to sell / unwind other positions to raise capital – hence why the market is down big and stocks that had large short positions are up

      Hence I was able to see a nice jump in one of the dogs I have been holding, SKT as well as in IRM which I have been holding due to the juicy dividend

      Seems the next targets of the reddit crowd are AMC and NOK. I bought a few shares for kicks and giggles (and I do mean a few)

      1. i sold IRM on the reddit pop. i also bought a little AMC just for kicks.
        Frankly i like what the reddits kids are doing. taking out wall street hedge funds. after all the abusive stuff wall street has gotten away with over the years its nice to see it happening to them instead.

        1. i dont recall ever seeing a stock trade over 1B shares outside an IPO.
          AMC is at 1.15B right now

        2. Yeah, I sold most of my SKT and a little IRM on these pops
          Limit orders to sell the rest of SKT and more IRM in case they pop again tomorrow

        3. I sold all of my IRM on the pop. Did not understand the reason for the sudden increase, and am optimistic that I can buy again when the price returns to it’s pre-pop levels.

  22. EPR, closed Friday at $ 37.29 and moved up sharply today on heavy volume.
    I’m guessing hedge funds were the buyers.
    I sold all my shares at 40.80.
    2WR, Here’s another “CUP” formation setting up nicely.

    1. Newman — LOL! Not saying EPR is an example but there’s so much casino type money in the market right now that to me, it’s difficult to feel comfortable in equities…. Yet those betting on red are the ones making the money these days, not me…….. it’s tough to argue with that… So what say you for the trading pattern on GME today??? It looks like the dreaded bed-o-nails pattern to me… lol

      1. Wow, GME is not for moi.
        It reminds me of the .Com days.
        I was tipped ACRS in January 2020 while in Vegas.
        Seems a genius in the family researched it diligently and bought his shares at $1+.
        Me and the Missus bought 3200 shares at 2.24.
        By the Summer of Covid, We were tiring of this nowhere stock. So we sold and broke even to making $ 500 or so.
        Now we hear the genius has sold a bit of it at $16 Just last week.
        And we went huh?
        That’s my story . I am not a Buy and Hold fellow.
        btw, In my taxable acct. I just bought 500 EPR at 39.50 and sold 5 July $40 calls at 7.20.
        Wish me Luck

  23. One might think that when you combine the new physics: what goes up never has to come down as long as the Fed is your backstop….with Modern Monetary policy i.e. you are not bankrupt as long as mass media says you’re not….that investing in equities would be easier. I find its just the opposite.
    I reviewed a number of lists of top global 1000 companies, Fortune 500 companies, Dividend Aristocrats, etc…..and was hard pressed to find 10 companies that I thought would still be in business 20 years from now, even though many of the companies have 50 and 100 year histories.
    So for me the question comes down to whether I want to join a herd that can’t seem to rush off the edge of a cliff fast enough or try to maintain a sane position by just having my eyes open and seeing what I see and ignoring what I’m told to see.
    It’s a difficult choice, its the difference between making money and not making money. Capital preservation and significant losses. I maintain that the 2008 Financial Crises has still not ended, illusions or delusions to the contrary.
    Preferreds and ETFs are my compromise and equities are my gamble. In my perfect world a 5% FDIC insured CD was all I ever needed…..and that world has been totally destroyed and will probably never return….for reasons or in whose interest I still don’t understand

  24. PCF – I don’t see a way to start a comment in the CEF section so I’ll ask here: Does anyone follow PCF and/or have an opinion regarding the rights issue?? the cutoff date = January 22 but with Fidelity, I have to decide by Jan 21… Anyone in this one???? Right now it looks like possibly a good deal to participate but nobody can be quite sure until after the fact just how much the issue itself will lower NAV…

    https://finance.yahoo.com/news/high-income-securities-fund-announces-223300699.html

  25. Anyone holding DD and have an opinion on their tender to exchange for Nutrition & Biosciences shares (which will then convert to International Flavors & Fragrance shares? I’m inclined to pass but wondering whether anyone is seeing something compelling in IFF.

  26. RILY – Not that I’m complaining or anything as I do own RILY, but does anyone have an explanation as to why RILY is soaring to 51.50 on a day when it priced 1,228,735 new shares in a secondary at $46??? Usually a secondary leads to a stock temporarily weakening in order to absorb the new supply, but not this time….. Yay!

  27. Many of us are holding “dry powder” to be able to react when the opportunity arises…looking for ideas where to store that powder while we are waiting.
    Open to ideas for relatively safe principal but yielding more than zero.

    1. AP, Besides Cash? The problem is that you are going to have to liquidate in order to re-allocate when stuff is cheaper….probably so will those temporary instruments.
      Traditionally treasuries can be effective (in theory) and they are liquid and good margin security depending on the term.
      Margin used properly and in a disciplined fashion can be effective, but that is the first things brokerages throttle back in a downturn and that should be well understood.
      An open home equity credit line with pre-arranged electronic transfer system to your brokerage set up can be a tool for deployment.
      Selling the labor of your children in the futures market??

    2. Andrew, I’ve used PULS and JPST ultrashort term ETFs in the past. Now yielding ~1.4% and very stable, but they will drop some if the bottom falls out. Just a lot less than common stock.

    3. One thing doable for very short term powder storage is buying called preferreds and baby bonds…. you’re talking about 30 day or less holding periods, but with zero commission trading available you can pretty simply earn 2% or better on an annualized basis on these essentially riskless buys. It’s definitely picking up pennies but when you’re earning 2% annualized with money that would be earning you zippo annualized otherwise, why not… Forget about trying to do this with called bank stocks because they’re always too high, but off names right now provide a safe possibility… they’ll hold value or appreciate ever so slightly toward call and usually are an easy sell without loss should you want your powder wetted, but it’s a timewaster of a trade for any other purpose… An example would be NGHCO which traded today between 25.06 and 25.07. It will be called on Feb 3. @ 25 + accrued which should be approx 25.1093. You do NOT get the 1/15/21 divvy payment however, even at 25.07, that nearly 4¢ you get above cost is about a 2.00% annualized yield, maybe better. Accurate calc is complicated due to trying to compensate for what you DON’T accrue between today’s settlement date today and 1/15 when accrual begins..

    4. Andrew, since we are in the common stock area, i like the prospects of growth and the current yield on AVGO. (I think the yield is 3%+). Have help this a while and it’s had a price run up but i think it’s still in a buy zone.

        1. I would not buy AVGOP…yield is higher than the common, but it is trading above the highest conversion price. The highest number of shares one can receive on mandatory conversion is 3.0303 shares. That means one would receive shares at a cost of 476.52 based on today’s price of 1444 on AVGOP. Note that the current price of AVGO is $443.

  28. Are we all just playing a futile game investing in preferreds these days??? I can’t ever remember a stock market as is being experienced today where percentage gains on so many individual stocks can be in double digits without any new buyers batting an eye about a concern for valuation… It’s really extraordinary…… It made me do a dumb little calculation…. On a lark, I bot $3500 worth of a new battery maker, EOSE, on November 24. Based on where EOSE stands right now, I would have to have invested $51,250 in 2050 shares of a $25 baby bond yielding 5.5% and held collected a year’s worth of dividends to equal that gain…. Yeah, I get it the gain on EOSE could very well turn out to be illusionary and yes my 2050 shares could maybe have appreciated oh say 5% as well as pay interest, but still, isn’t this a crazy world right now??? The Efficient Market Hypothesis for the stock market seems like such a quaint concept today.. [https://en.wikipedia.org/wiki/Efficient-market_hypothesis] I suppose there’s nothing terribly meaningful about this post. I’m just voicing amazement at today’s markets.

    1. Sorry – meant to say “where percentage [DAILY] gains on so many individual stocks can be in double digits”

    2. 2WR, it does seem to be difficult to justify stock prices now and for the past year or more. If inflation gets its legs under itself later this year and/or the FED gets cold feet about pumping money into the economy nonstop there could be a reckoning that is painful indeed.

    3. 2wr: We can very effectively turn into an economy based on trading! When the is no risk, there are no losers!
      In the words of the investment guru/prophet: Merle Haggard, “drinkin that green bubble up and eatin that rainbow stew…”

    4. First, I would say I have different objectives for my preferred portfolios than for equity MFs and ETFs. The primary purpose for me as a “buy and hold” preferred investor is income flow rather than price appreciation.

      That said, my preferreds in the aggregate are up 30% over cost of purchase, lowering the yield on original investment of 7.43% to a current yield on market value of 5.68%. I have no expectation of further price appreciation, in fact the opposite. But, who knows?

    5. You just need to know what Musk will tweet next, I’ve never shorted a stock but the Signal story sure makes me wish I knew how.

  29. CUBI – Has anyone found a way to find out what to expect regarding when CUBI shareholders should receive shares of BMTX from the divestiture? Given it was completed in Jan 4 I would have thought that the new shares should have shown up in my accounts by now, but calls to TDA and Fidelity Corp Actions have so far been met with blank stares as no one seems to know anything….. CUBI IR is between IR directors so that doesn’t seem to be a helpful avenue either, though the Director of Marketing has been very helpful in attempting to find out more.. So far, though, he too has no answers…

      1. EarlyB – that link would only show up on your own computer I think… In any event I just got this from Director of Communications and Marketing : shareholders will be receiving a letter from Jay Sidhu by email that has lots of details (attached).  I can also tell you that the website IR page will soon have that letter with these bullet points:

        BankMobile – Special Distribution

        Customers Bancorp closed its divestiture of BankMobile on January 4, 2021.  Holders of CUBI common stock will share an aggregate of 4,876,387 shares of BM Technologies, Inc (“BMT”) common stock. Each holder of CUBI common stock is entitled to receive 0.15389 shares of BMT common stock for each share of Customers common stock held as of the close of business on the Record Date of December 18, 2020. BMT shares are being issued to eligible Customers shareholders exclusively in book entry form by BMT’s transfer agent, Continental Stock Transfer and Trust Company until the transfer restrictions have been lifted or expire pursuant to their terms. Shareholders will receive a statement from Continental that evidences the issuance of the special distribution of BMT stock.The BMT shares received by Customers shareholders are subject to certain transfer restrictions and are not immediately tradeable. The shares are subject to a lock-up period beginning on the January 6 and continuing as described in the letter to shareholders from Customers Bancorp Chair Jay Sidhu. Other important details are also contained in this letter. If you have any questions regarding your BMT shares, you can contact Continental Shareholder Services at 800-509-5586 or via email at cstmail@continentalstock.com.

    1. Doesn’t really answer your question but my shares of MFAC at Vanguard did turn into BMTX on schedule.

      1. No, it doesn’t, Bob but interesting none the less…. So what do you figure accounts for the price drop these past 2 days? I’m not even sure what my cost basis is going to be but best I could figure it’s supposed to have been around 10.38 coming from the CUBI side… Do you know yours???? Is the selling in your opinion just fast money locking in and moving on?

        1. no idea actually. i look at this as having 10-bagger potential and it will take years to unfold. there aren’t many pure play fintechs that i would touch but i’ll give this one a shot.

          1. I’ve been trying to figure out what Bank Mobile does that makes it appealing. I’m sure I’m not the target customer since banking seems so simple to me and can’t imagine what Bank Mobile could offer me that is better. If they truly have over a million customers they are doing something right even if I don’t understand it.

            1. BMTX is not for you, or for me, but the kids are going for it in a big way. It’s online only, like the rest of their lives, and they focus on customer acquisition at the college level. The aim to do full service financial services all on your phone. None of it is rocket science but if they can establish a leadership position quickly enough they will crowd out competition.

              1. I really doubt BankMobile is going to establish any leadership position. Tons of banks already offer mobile banking apps. BankMobile is no different than those. And kids regularly use platforms like Venmo, CashApp, etc.

                My 27 year old daughter after graduating from college took a job out of state. She has now been working 6 + years now. She has not set foot in a bank all that time. She uses the app from her bank account that she had in college. She rarely uses ATMs. Paychecks get direct deposited. Money she makes free lancing transferred via Venmo. The rare check she gets she deposits online via her bank’s phone app. She uses a credit card for purchases and has it paid automatically from her bank account. When she had roommates, they would transfer funds to each other via Venmo or cashapp for their share of rent, utilities, etc. I think in 6+ years she has written 3 whole checks. Yes, just 3. So yes, younger adults live online on their phones today. But BankMobile has far from first mover advantage. they are just another option in a sea of existing ones

                1. Mav – that is certainly one side of the debate. The other is that a bank with an online only focus, aimed squarely at kids just entering the financial world for the first time, can leapfrog the others. Jeff Bezos was hardly the first person to have the idea of selling remaindered books (online or not) but his execution certainly was better. Microsoft wasn’t the first company out with a small computer operating system (they actually bought DOS from another company) but they made a greater commercial success of it. Many other examples.

                  I don’t invest in may individual equities often but I threw a few (thousand) bucks at this to see if the team could make something of it.

                  1. Bob – I just don’t see what advantage BankMobile has. I looked at their app, it does the same thing my daughters small credit union app does or my bigger bank app does. As to online only – I have funds at Ally Bank and their app actually does more than BankMobile. So not sure one can say Bankmobiles tech is better or going to leapfrog the competition.

                    As far as first mover advantage, that ship long ago sailed. So I just don’t see the advantage BankMobile has.

                    Anyway, good luck with it but I personally would not count on it becoming the next big thing

                    1. Mav – Though my expectations are not over the top on BankMobile, I think one point you may be overlooking is that most likely, even your now 33 year old daughter may not be BM’s primary target and, if that’s the case, then the idea that the “first mover advantage” has already sailed could be wrong and will in a way always never sail because I believe BM’s target is essentially first time openers of bank accounts always…. They’ve established proprietary relationships with something like 725 colleges so far with an eye toward becoming the first bank new incoming college frosh consider having with the assumption being that if they can get ’em when they’re beginning their first banking relationship, they’ll have a high percentage of sticky account relationships that will stay with them forever…. So as long as colleges have incoming freshmen every year, BM is trying to position themselves to possibly always be perceived by their target audience’s “first movers.” Throw in their newly established positioning with Google Pay, and it looks like they’re heading in the right direction… But then again what the heck do I know?? I had to look up Venmo just to see what you were talking about…. lol

                    2. 2WR – I do understand their marketing strategy. And yes, on one level, it makes sense to target college freshman and hope they stick. But think about this. How many college freshman are there that don’t have an existing bank account.

                      I think you can break these freshman down into a few categories. Those who already have an account, those who don’t but have no job / income, those who don’t but work a part time job in college. So really the target audience is that last group.

                      I believe you will find a number of students who go off to college have an account already – either to hold funds they earned from working a summer or two in high school, set up by their parents , etc. I mean, how many kids go off to college with no spending money to their name? Or no easy way for their parents to deposit money if they need it?

                      But let’s assume there are some – well if they don’t work in college, why would they need an account? They have no funds and no funds incoming.

                      So now you are down to that last group who have no account but get a job in college to earn some money. I just personally don’t think the numbers are that big. I could be wrong of course, but just my sense.

                      Just my 2 cents from my work experience. Good luck with it

                      PS – just a correction on what you wrote and sorry if what I previously wrote may have mislead you – my daughter is currently 27. She graduated at 21 and has worked for 6 years

                    3. Mav – You know, in the back of my head I was thinking I should probably reread more carefully what you wrote before coming up with that 33 number, but I took the lazy writer’s way out and just winged it.. Sorry ’bout that… I do think that their target audience is broader than how you define it, but still, I also think it’s not a wide moat competitive advantage that they have and the key to success will have to be execute, execute, execute…. Given my initial exposure will be based on such a very small percentage of my already small amount of CUBI common, I suppose my exposure might equate to merely a freezer full of future steak dinners. This will be more of an adventure into de “youts” banking behavior these days as Cousin Vinnie might say than anything else.. Those days are so far behind me I don’t even remember whether I had an existing account heading into freshman year or not, despite having had summer jobs throughout high school and probably even prior. I do remember feeling uncomfortable with money in those early years so the door would have been open to any entity looking to coddle my wallet..

                    4. 2WR – No problem. And yes, if one can figure out in advance what “De youts” next big thing is, one can profit from it.

                      As Vinny would say – Oh you like grits? I like grits too, how do you like your grits? Regular, creamy or al dente?

  30. I have not been looking that hard, but I like Enbridge stock for 2021. Already an ~8% dividend on the common, and the dividend could go up quite a bit once Line 3 replacement construction is completed.

    Not finding much I like for Preferreds right now. NSARO is my only preferred holding.

    1. I have been in ENB off and on over the years – currently in and added a nice block recently (~31.75) to my holdings. Nice holding, great dividend (reasonably safe), and good prospects.

      1. Jake, Tim and Proto above,
        I third…or fourth… the motion. Can go naked, but I am using puts and call with them too, but not necessary. Good volume and bid/ask.

  31. Anybody follow CNFR?? I can’t see any reason why the price has doubled in AH. I’ve followed it for a couple of years, owned CNFRL for a while and to date have seen no signs of a turnaround or any other reason to get back involved, so what’s caused this spike? Somebody knows something because it’s on large volume as well.. Maybe it’s just because Robinhood’s run out of $2.50 stocks to play with..

    1. 2WR–saw that pop this morning–can’t find any news anywhere. I learned my lesson on these small insurers with Atlas Financial–they are all pretty dangerous.

      1. Amen, Tim… I had followed Atlas as well, but fortunately never bot in… as mentioned, no visible signs of actionable turnaround in CNFR in the past 2 years imho. Still the volume’s crazy on the day but the whole event seems to be based on absolutely no news….. perhaps just another example of capability to get momo players in today’s market to glom on to anything without knowing nothing……. And who can blame them? They’re winning for now….

      2. Need some advice on a loser of mine. “Freeport” FCX have held since 2013 in a retirement account. Paid a nice 4% dividend at time of purchase, actually picked off a special dividend to boot. Management took a mining company $20 billion in debt with poorly timed bet on energy and suspended dividend. I’ve road this dog for years, with miracle rebound plus another 7% today, now about $500 from break even. If not qualified money? surely someone has had a similar problem? any comment helpful.

        1. Mike – Have you ever heard the Wall St cliche, “The market doesn’t care what price you paid?” I think it’s one to always keep in the back of the head because we all probably have the same tendency to think emotionally and possibly do what you seem to be describing where your buy/sell decision is based more on original cost, no matter how old and out of date that cost basis info may be, than considering today’s prospects for the stock in question…. Here’s one short article that sums this concept up – https://rogermontgomery.com/the-market-doesnt-care-what-price-you-paid-2/. There are probably even better articles out there but the conclusion made is, “ask yourself: would I buy this stock today at the current price? If your answer is no, then it is likely that you are making an emotional investment [or emotional decision to hold]….”

          1. 2whiteroses, agree. I remember when Nomadicmist posted “If I didn’t own this stock today would I still buy it now”? I keep that on a post-it note next to my computer. I need that reminder to counter my emotional leanings. Sometimes it’s hard letting go and moving on.

        2. Mike, You have ridden through the commodity bottom. It can be grueling! These are notoriously long, multi-year and frustrating. It’s a throw in the towel challenge…I hear ya.
          My take is that now the multi-year bottom has been placed, oil, ag, metals, and the first move up is not to be believed…AGAIN. I see this as the first wave back up, there will be sellers here, then a sustained, higher low which will create a verification for the real trend move up. It could take a while since commodities move slow.
          The other good news is that these businesses and tough-ass managers have LONG experience managing these commodity cycles and have wrung out their balance sheets so now, small increases in their commodity pricing can really flow right down to their bottom lines and hence share price. Corn, Copper, Silver, Oil, even NGas.
          As an indicator: Basic commodities are at a very low percentage of overall market cap and when they begin to reassert, many institutions will jump in too. I am a holder and overweight commodity companies (using options too) and preferreds in my portfolio. In answer to 2wr above, yes I would buy here.

          1. thanks joel & 2wr, Just saw on cnbc half time’s Pete Najarian just bought Feb. $29 call options on FCX I’m not an option expert or trader, but I’d say he also likes Freeports chances. Thanks again Mike

  32. Does anyone else here follow CASS? It looks kind of appealing at it’s current price. I own some but was considering adding.

  33. Has anyone investigated the much hyped electric battery automotive and lidar autonomous driving fields? I’m looking at Quantumscape (QS) for their solid state EV battery development and two lidar tech companies, Luminar (LAZR) and Velodyne (VLDR). All three common stocks are on a tear, plus they have warrants available, QS.WS, LAZRW, and VLDRW respectively. Any thoughts?

    1. mikeo – wished you had mentioned QS in early November before it increased 1000%! 12.93 beginning of Nov to 119 today.

      1. danzeb, yes it would have been great to be onboard QS 6 weeks ago! When I got edu-ma-cated last Friday I pulled out the double edged leverage sword and bought a few QS.WS warrants and am up about 75%.

  34. 180Degree Capital Corp. [TURN] announces a 1 for 3 reverse stock split and possible $2.5 mil buyback
    TURN is a tiny (pun intended given stock symbol used to be TINY] registered closed end fund that I only mention because The CEO’s letter to shareholders is such a refreshing read. I own it but mention it more as commentary on a CEO’s candor.

    https://ir.180degreecapital.com/press-releases/detail/342/180-degree-capital-corp-announces-the-initiation-of

    12/21/10
    Fellow 180 Shareholders,

    I now know what it is like to live the life of a dog; in that every dog year lived is equivalent to seven years lived for human beings. 2020 has definitely felt like more than one year; it has actually felt like a decade. This year has been a trying one for many as a global pandemic claimed over 320,000 lives in the United States. To put that into horrific perspective, that is the equivalent of having a 9/11 terrorist attack, where over 3,000 lives were lost, every day for 107 straight days. I sympathize with anyone, who, because of the pandemic, has had to endure a loss of a loved one. I equally sympathize with those that suffered from economic hardship as a result of the fallout from the events of this year. For those that have sought to minimize the effects of the pandemic, I question their sanity, their belief in facts and science, and their overall motives. Thankfully, vaccines are here and are being distributed. We are now near the end of what has been a year to forget as far as I’m concerned. Over the years, I have had so many wonderful conversations with 180 shareholders and I truly hope all of our shareholders are safe and well.

    As we exit the year, we are going to be instituting two actions for 180 shareholders. First, effective January 4, 2021, we will be initiating a 1-for-3 reverse stock split. Second, we will begin share repurchases under our $2.5 million stock buyback program, particularly in the event that our share price responds in the opposite way to what is intended by this announcement of the reverse stock split. I think almost everyone who has followed us over the last four years knows that we are fully transparent with all that we are doing in our effort to create value for our shareholders. As such, we wanted to discuss each of these steps in more detail with you.

    First things first, the reverse stock split. By definition, a stock price split has no inherent effect on a company’s enterprise value. The market capitalization of 180 after the split should have exactly the same value as it does before the split. If I was cooking and the recipe called for a stick of butter, would it make a difference if I added a whole stick or two halves? No. You would have exactly the same amount of butter. But in the three-dimensional psychological analysis world of stock splits, to some, reverse stock splits are perceived to be a “bad” thing, while the popular 2-for-1 (or whatever the ratio is) stock splits are perceived to be a “good” thing. It is true that some reverse stock splits are enacted from low quality companies whose price per share is below $1. These companies face delisting from stock exchanges that have minimum share price rules. Well, that’s obviously not 180. As of the close of business December 18, 2020, we have grown our cash and securities of publicly traded companies to nearly $58 million or $1.86/share. That is up from $17 million net of outstanding debt, or $0.55/share, in mid-2016. Over our history we have carved out a name for ourselves for our unique strategy in the asset class we invest in. 180 has a remade balance sheet, a healthy business model, and hopefully you agree, both a short and long term shareholder friendly view of value creation. We have heard from a number of shareholders that a higher priced stock would attract more attention from both the institutional and retail world of investors. Many institutions require a company’s stock price to be above $3/share, or even $5/share before they even consider investing in the company. Many of our shareholders have asked us to do the reverse stock split to make us more attractive to a more diverse set of shareholders. That is it. There is nothing more complicated about why we sought and obtained shareholder approval for the reverse stock split at our 2020 Annual Meeting of Shareholders. There is no bad news here and there is no ulterior motive! As a matter of fact, while there are still a couple weeks left in the year, we currently believe we will grow our net asset value per share (“NAV”) once again in Q4 2020.

    Now, for those that maintain some sort of negative view on a reverse stock split, while I will never agree with your view based on math, I do not live under a rock as it relates to understanding the perception issue related to them. Should unexpected weaknesses arise, we will use the opportunity to repurchase our stock under our Board-authorized $2.5 million share repurchase program. Since our shareholder call in November, we have continued to grow our net asset value through our public investment strategy. While there are still a couple weeks left in 2020, we currently estimate that our NAV will be back above $3.00 by December 31, 2020. Within this estimated NAV, cash and securities of publicly traded companies account for approximately $1.86/share, or approximately $58 million, as of December 18, 2020. This amount of cash and securities of publicly traded companies does not include the carried interest on our separately managed account that we currently estimate will be more than $2 million. Our closing stock price as of December 18, 2020, was $1.91, which suggests investors are ascribing virtually zero value to our private portfolio holdings. To be blunt, I find our public market valuation to be absurd. I have consistently stated that over the last year as our management team has personally reached into our pockets and bought TURN in the open market. Today’s accretive share repurchase is the next step towards the goal of creating value for our shareholders.

    This repurchase says nothing about our belief in our ability to create value from our strategy. This has everything to do with our own stock price. This management team has bought over 5% of the Company with its own after-tax dollars in the last four years. We have completely transformed our business with competitive public market stock picking performance. We have grown our cash and securities of publicly traded companies by over $40 million since I joined 180’s Board. Our NAV is currently expected to climb to above $3.00 by year end. And for all that, the market believes our business is worth $1.91? We do not. As such, we will be aggressive in our share repurchases.

    If anyone wants to discuss any of these announcements, you know where to find us and I will look forward to that call. On behalf of all of 180, I hope everyone has a happy holiday season, and we look forward to talking to you in 2021.

    Best Regards,

    Kevin M. Rendino
    Chairman and Chief Executive Officer

  35. ORI declared a $1.00 per share special dividend. x-div Jan 4. This is one of my larger common stock holdings. Solid, old line company with a very good track record, 4.5% dividend, and some upside potential on the stock price.

    1. Nice. I have owned ORI for many years. Nice to see yet another special dividend from them.

  36. COST: Costco opened its 800th warehouse today. Five more warehouse openings are slated by the end of November. Revenues are running +10% year/year. Like many, their online sales have exploded this year. They are currently sitting on $12 billion in cash and talk of a special dividend in the spring is swirling.

    1. This afternoon Costco announced a special dividend of $10 per share to be paid next month!

    2. COST is certainly interesting. The strange thing to me is that Buffet exited his entire holding of COST. Since he’s smarter than me, that gives me pause…

  37. CUBI – I know some here follow CUBI – any opinion on shareholders now to be directly receiving shares of BankMobile upon the spinoff before the end of the year? I note a 1 year lockup on the shares which is not thrilling, but I look forward to receiving shares of BM Technologies [BMTX], which will be the corporate name of BankMobile once the shares are distributed:

    https://www.sec.gov/ix?doc=/Archives/edgar/data/1488813/000095015920000234/cubi8k.htm

    As previously disclosed, on August 6, 2020, Megalith Financial Acquisition Corp., a Delaware corporation (“Megalith”), MFAC Merger Sub Inc., a Pennsylvania corporation and (“Merger Sub”) a wholly-owned subsidiary of Megalith, BankMobile Technologies, Inc., a Pennsylvania corporation (“BankMobile”) and Customers Bank, a Pennsylvania state chartered bank and the sole shareholder of BankMobile (the “Bank”), entered into an Agreement and Plan of Merger (the “Original Merger Agreement”). On November 2, 2020, Megalith, Merger Sub, BankMobile, the Bank and Customers Bancorp, Inc., the sole shareholder of the Bank (“Customers Bancorp”), entered into a First Amendment to Agreement and Plan of Merger (the “First Amendment;” and, the Original Merger Agreement, as amended by the First Amendment, the “Merger Agreement”). Pursuant to the Merger Agreement, at the closing of the transactions contemplated by the Merger Agreement (the “Closing”), BankMobile will merge with and into Merger Sub (the “Merger”), with Merger Sub continuing as the surviving corporation.

    The Original Merger Agreement provided that a portion of the consideration payable to the Bank in the proposed Merger was to be paid in shares (the “Merger Consideration Shares”) of Megalith’s Class A common stock to the Bank. Pursuant to the First Amendment, the Original Merger Agreement was amended to provide that (i) Customers Bancorp would become a party to the Merger Agreement, (ii) the Merger Consideration Shares will now be issued directly to the stockholders of Customers Bancorp instead of to the Bank and (iii) Customers Bancorp may at its discretion, upon written notice to Megalith, redirect or reallocate the distribution of the Merger Consideration Shares at any time prior to the Closing to other parties.

    Additionally, the Original Merger Agreement was amended to provide that, subject to certain exceptions, there will be restrictions on the sale or transfer of the Merger Consideration Shares for a period of twelve months after the Closing, rather than for a period of 180 days after the Closing as contemplated by the Lock-Up Agreement attached to the Original Merger Agreement.

  38. Sold GAB, The Gabelli Equity fund today.
    its trading at almost a 9% premium to NAV compared to its 5 and 10 year average of close to zero. plus with its policy of paying out 10% of NAV as dividends per year and a current NAV of 5.24 i expect next years payout to be closer to .50.

  39. I’m sure a number of us are also interested in common stocks that provide decent dividends. I’ve owned AT&T (T) for a while, and with a 7.5% dividend, I’ve found it quite attractive. Sure, the share price is down after Covid, but before then it had been doing quite well. Frankly, at 7.5%, I don’t care too much about the share price (as long as it doesn’t drop dramatically). I’m trying to think if I’m missing something on this one, but it sure looks like a decent candidate for an income investor.

    1. AT&T is trading close to 10 year lows, so the downside risk for share price is minimal (imo). Dividend increases over the past decade have kept pace with inflation. AT&T has lots of cash flow, and the low interest rate environment make its massive pile of debt look less ominous. I’ve always maintained a core position in T but add to or subtract from that position depending on share price…currently adding.

      1. be care full guys, the old southern bell “SBC “, before the formation of current “T” had a big dividend in 2002, which was cut in half, the total return since that episode without reinvesting dividends, is like 1.9% for 18 years. If your in it now with a good cost OK, but starting a new position here leaves a taste in my mouth. debt & Hat size dividends are always a red flags.

        1. Meh…there is much more risk in the REIT space right now than there is with AT&T at these levels. I’m willing to put AT&T up against any REIT on your recent list of recommendations for total return over the next 3-6 months. Want to make a friendly wager on it Mike?

          1. Citadel West, your may be right about a 3-6 month time frame, which is irrelevant to me. I was only only speaking from experience in ’02 on old SBC I don’t recall posting any recommendation list of reits. I have commented on holding STOR and WPC and a couple PSA preferreds, and asked for an opinion of STAG, if that constitutes a recommendation, so be it. As far as exposure in the telecom sector, its Verizon & Telus up north. Better watch what I comment on in the future, if this is a betting “site”?

            1. I happen to think REITS are a terrible investment right now Mike, and I’m sure if we look back 20 years or so we can find a couple of “red flags” on both STOR and WPC. The difference I guess is that I don’t feel compelled to show up in REIT Chat to pour cold water on folks when they’re talking their book there. Since you don’t want to make a friendly wager, then maybe you’ll take some friendly advice.

              1. Citadel West, what’s a good invest investment now ? everything is overpriced including preferred’s, and reits have been hammered. How did I ” pour cold water”: on any bodies book? I’ll now keep my opinions to my self, read the good information, and dismiss the “vomit”.

              2. Get real – giving a differing opinion is not pouring cold water on anyone’s book. It’s a discussion forum, everyone will have different opinions. Learn from them rather than attacking someone who has a different opinion than you do

                And FWIW, I have owned T as well as a host of REITs for some time. My most recent buys from that group have been in REITS because they have been beaten down and I see the potential for more long term upside there in the right REITS. T is nice for the dividend but it has been range bound for years

                1. Agree with you Maverick. I own T but have not added to it in years. I think my cost basis is around 31 or so.
                  Recently, I have bought a significant position in FRT and small amounts of MNR and UBA on dips. More upside in them than T IMHO with a decent dividend while we wait.

                  1. Thanks Bill. I too have added some FRT. And I believe I mentioned recently I like a few of the Apartment Reits (AVB & CPT are my 2 favorites) as I see them undervalued now – and am willing to take a reasonable dividend while I wait

                2. Since when is offering to make a friendly wager with someone over a difference of opinion considered to be attack? Mike is clearly traumatized over the prospect of “betting” but that doesn’t mean I attacked him.

                  Anywhoo…my offer stands, your top REIT against AT&T, for % total return over the next 3 months. We’ll use this Friday’s close as the starting point, and you can sell your position and go to cash at any point along the way.

                  Any takers?

                  1. First off Citadel, all Mike did was give his opinion on T based on his past history with old Southern Bell. He never mentioned any REIT at all – you brought it up and challenged him to a wager. Mike declined because for him, just like for me, 3 to 6 months is irrelevant. Except for some planned flips of new issues, I typically invest for the long term – not 3 months. Seems Mike does the same

                    Second, you then told Mike “The difference I guess is that I don’t feel compelled to show up in REIT Chat to pour cold water on folks when they’re talking their book there. ” Then you followed that up with “Mike is clearly traumatized over the prospect of “betting” but that doesn’t mean I attacked him. ”

                    What the hell? Seems to me Mike simply gave his opinion on a stock and just because it was opposite of yours, you attack him for it for no reason and continue to do so.

                    And no, I want no part of your silly wager either. I do not invest for 3 months out

                    1. To all who commented and also “TIM”, Thanks for the support, I never intended and never will intentionally offend anyone. I’m learning where I can have a discussion and who to avoid. I certainly don’t want to taint this valuable resource.

                    2. mike–sorry if you had a bad experience, but you are right that some conversation is more accepted than others. I don’t think many folks intend to offend here–although it happens and I am of the thought that the ‘more the merrier’.

                    3. Go back and read my original comment about AT&T and you’ll see that I covered the debt issue as well as the historical trends in share price. There is absolutely no need to go back 20 years for “red flags”, unless the object is to throw dirt on the subject. In fact at least one of the REITS that Mike prefers to invest in doesn’t even have a 20 year track record to look at…go figure.

                      If you’re unwilling to back up your “opinion” with a wager that’s fine, but
                      don’t presume to lecture me about it… your crew doesn’t hold any exclusive franchise on profitable income investing, in fact far from it.

                  2. Maybe Warren Buffet, will take you up, Berkshire recently doubled down its stake in that newcomer STOR your referred to: I’ve heard he plays cards with Bill Gates you’ll have to ask him if he bets? good bye and good luck

                    1. Buffet and Gates play bridge. They have played competitively in-person and also play online at bbo.com. Gates is a part owner of bbo.

                    2. Citadel – Damn, I have a crew now – who knew. Can you please let me know who they are, I need to add them to my Christmas Card list.

                      As to T and REITS, you really are missing the point. As I said I have owned T for many years and I have owned various REITS for some time as well. There is a place for both in my portfolio. But I would not be putting my new money into T right now. And who cares if one of the REITS Mike likes hasn’t been around for more than 20 years? Are you saying a newer company can not offer a compelling investment?

          2. citadel west, just cleaning up some “old” business from your bet offer of last month. AT&T has done well along with the market. That newcomer “STOR” you beat up, in the “reit’ space has rallied 19.2% since you offered to bet for whatever reason. Not pouring cold water on anybody here. Both have a way to go past 3-6 months.

      2. Dave and CW

        I’m an Old Telephone Guy who is a retiree of an AT&T subsidiary (Avaya). My telecom common stock exposure is with LUMN and I suggest you give it a look in lieu of T.

        LUMN is a the old US West and a roll-up of major fiber plays and many rural telcos. The new CEO has been successful paying down the sizable debt with the free cash flow and I think (eventually) the stock price will rise significantly. The current yield is ~10%.

  40. Anyone have an idea on why PCG surged this week? I had been trading in and out of it for fun but it soared this week and I can’t find anything as to why.

    By the way, have they paid out the cumulative dividends on those preferreds yet?

  41. CUBI – I don’t profess to be a good stock analyst but it sure seems to be amazing just how hated all bank stocks seem to be today, no matter what news they announce… CUBI confirmed once again today that their target EPS for 2020 is $3/share, just as they have projected all year long and yet the stock is down on the day @ around $12/share or 4 P/E…. I guess banks are never getting out of the doghouse until “lower for longer” goes out of style.

  42. Sachem Capital (SACH) is breaking out big to the upside with volume, up 13% so far on the day. No news reported, so this might be a technical move based on the 50dma crossing above the 200dma. Good for all long positions, especially if there is some follow through next week.

    1. Decent follow through for Sachem Capital (SACH) today, currently up 5.00% on approximately 3x normal volume. This stock currently yields ~12.50% and goes ex-div at the end of October.

  43. The PBCT has very strong support at 10.5, I started to build a position in this dividend aristocrat.
    At least their 6.8% divies looks good for these times.

  44. Warning – the market is very dangerous right now. The same negative divergences are happening now that happened in ‘07, ‘11, ‘15, ‘18, ‘20 right before big corrections. A/D line, stocks above 50 dma., Vix, vxn, are not confirming new highs. Not to mention that QQQ is 25% above its 200 dma. We have only seen a higher number 2 times and they both ended badly. Reversion to the mean can be a bitch. At least take some profits and sell the weak stocks. Hope this warning saves you some cash. Capital preservation, ATB.

    1. Thanks Tim…yes your warning was very helpful. It gave me more confidence in trimming some stinkers and winners.

  45. Someone is long EVRG? It looks like it found it’s bottom at 50 and from there consolidation begins.
    Probably, I will start to slowly build a position there so that no one say that I am a permabear ))))

  46. Thinking about starting to pick up Dow’s Fallen Angels PFE, RTX and XOM. Not sure about the XOM, there is a lot of risks in the Energy sector.

    1. Yurly – Do you happen to know anything about ANGL, VanEck Vectors Fallen Angel High Yield Bond ETF?? I just saw an ad for it today and thought it might be worth investigating… Is this out of place for Common Stock Chat?

      1. I follow this index but have never bought ETF. I believe there is too much garbage there, e.g. such as CBL or X https://www.vaneck.com/etf/income/angl/holdings/
        Now there is a great demand for Junk at the market and these funds (ANGL, JNK, HYG etc.) are trading high, but sooner or later many companies from their portfolios will go bankrupt and investors will write down their losses.
        Too much risk for the 5% yield IMO.

    2. Yuriy: saw you posted in “canadian discussion” thought you might have an opinion on a canadian fallen angel Suncor SU “buffett” increased position ?
      In roth, no withholding of dividends. Saw some buy ratings and price targets, thanks anyone else for input, maybe “canuck buck”

      1. Of the Canadian commons I’m currently long only on the NTR.
        SU is a “buy” just because is a WB backed, but personally I prefer not to buy loss-making companies. Especially from the energy sector. I own some HSE but only their prefs.

      2. Mike, I’ll chirp in here as a follower of many Canadians. Do a deep look at these two royalty streamers which do have OTC symbols as well: FRHLF and PREKF. Of course they are available TSX. Another outlier is IPPLF. I bot into all three and now is a good entry point in my reckoning.
        I have followed them for years and the presentation they have on their sites tell their real story and diligence on management through every up and down cycle. Even if you want to just understand another business model. Freehold pays monthly. The other two used to pay monthly, but switched.to quar.
        With these streamers you are an OWNER and just let the hardened management do their jobs. They move the div up and down as a target percentage of free cash flow. If divys go down with the cycle then buy when they are low like now. Say it again, “like at these current prices!”
        These are tough survivors and the two royalty streamers have NO debt, own NO infrastructure or hold no liability, plugged into delivery systems. Core holdings for me esp at this price. Good ‘oily’ holdings in lieu of companies with massive debt and liability issues.
        Oh yeah, SU is proven tough SOBs too!
        Happy hunting! JA

        1. joel thanks for the leads. I have several Canadians in my roth as foriegn exposure, BIP, BAM, EMB, NTR, BNS, TU. more comfortable up north than europe or far east, I’ll checkout tax treatment of your ideas plus canadian prefferreds. thanks again!

  47. Today I bought two regional banks – PEBO and ASB both paying in the 5-6% range on common dividend. I think there is probably more upside here than in the preferred space at the moment.

  48. I just noticed that a call option that I previously sold on OXY (and many other call and put options) have now been reclassified as “non-standard” options. Does anybody know why and what is the effect. Could it have had anything to do with their junk bond offering? Any info or suggestion as to where to look would be appreciated.

    1. they distributed warrants, so you have to deliver those as well hence non standard. see recent press releases

  49. PG&E (PCG) started trading. Seems like they gave away the company on IPO, which is usually the case. In my experience, these are great buys once they come out of bankruptcy. The investment banks under price it so they get to buy all they want to make up for their losses. Even M* commented how low it was. Food for thought.

  50. I opened a small position in AT&T this morning, with an eye on the ex-dividend date upcoming in several weeks. The current yield on T is around 6.85% which is reasonable in this environment. This is a tough market to forecast, but my expectation is that AT&T has the cash flow needed to maintain its dividend. I fully expect another ‘risk-off’ correction as second quarter earnings are reported, so there may be opportunities to add to this position over the summer.

    1. I’ve been considering T for some time now, attracted (as usual) by the yield. The company is working on reducing the mountain of debt they piled up in their shopping spree and to that end they may have to resort to some asset sales. But the best thing that could happen is for the CEO to finally leave and allow a more conservative manager to come in and tackle that debt. I also believe there will be more opportunities to add to a starter position later in the year.

      1. AT&T you have to go in knowing the next 10yrs the stock will stay flat to go down. If you reinvest all dividends this will cause a great opportunity for wealth creation.

        Once the business leverage is reduced growth will return and price appreciation will restart.

        Essentially businesses like this for most investors are non-investable due to the long timeline involved.

  51. Recently been on the look out for quality CEF funds using data from the recent crash.

    Screened for positive 3/5yr NAV trend which eliminated 80% of funds. 100% coverage of distribution. and 80% investment grade or higher.

    Truly wanted unleveraged funds to avoid messy deleveraging when markets go irrational. Only found 2 so I started to review leveraged candidates as well. Municipals seem to be the goto asset class for this type of screen.

    Which makes me wonder when states are asking for debt bailouts.

    Target Date:
    (Muni) BTT – BlackRock Municipal 2030 Target Term (Leverage Y) Current Distribution: 3.16%

    Unleveraged:
    (Muni) MTT – Western Asset Muni Defin Opp Tr Inc (Leverage N) Current Distribution: 3.63%
    (Muni) NXR – Nuveen Select Tax Free Inc (Leverage N) Current Distribution: 3.32%

    Leveraged:
    (Muni) BBN – BlackRock Taxable Municipal Bond Trust (Leverage Y) Current Distribution: 5.62%
    (Muni) EIM – Eaton Vance Municipal Bond (Leverage Y) Current Distribution: 4.65%
    (Muni) DTF – DTF Tax Free Income (Leverage Y) Current Distribution: 3.38%
    (Muni) MQY – BlackRock Muniyield Quality (Leverage Y) Current Distribution: 4.36%
    (Muni) BYM – BlackRock Muni Inc Qty Trust (Leverage Y) Current Distribution: 4.24%
    (Muni) DMF – BNY Mellon Municipal Income(Leverage Y) Current Distribution: 4.19%
    (Muni) BAF – BlackRock Muni Inc Inv Qty Tr (Leverage Y) Current Distribution: 4.56%
    (Muni) PMO – Putnam Muni Opportunities(Leverage Y) Current Distribution: 5.02%

    1. BBN is a different breed of Muni bond fund, a CEF holding taxable municipals and Build America Bonds, which is why it’s yield is higher than the others.

  52. I’m a long-time shareholder, retaining my WFC position, this is dirt cheap for the stock but don’t be surprised if the dividend gets cut.

  53. Looking at some of Nomad’s old comments and saw that on Friday another of Rita Moron picks bit the dust. ATAX cuts its dividend 52%
    Also they paid off their debt with Deutsche bank and terminated their relationship and opened new debt financing with lender Mizuho Capitol. Like taking one credit card to pay off another.

  54. rtx, gd, lhx Once you think they are down and out another contract shows up. Blowing up stuff never goes out of fashion.

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