Looking at the bounce in equities today makes me wonder if this rally is here to stay–or do we get another plunge next week?
Right now I am mostly watching and waiting–I’m waiting to see how many high quality low coupon preferreds will be redeemed–I’m waiting for the China resolution (and not holding my breath)–I’m waiting for a market panic so I can scoop up some bargains. I’m waiting for a lot of things to happen–all which I believe will happen, but I have no idea when they will occur.
Yesterday our reader Fred noted that retail REIT Kimco (NYSE:KIM) was selling a 3.70% note with a maturity out in 2049–sick–30 years at 3.70%!! They will redeem the KIM-I 6% preferred issue and the KIM-K 5.625% preferred issue. Look for lots more of this kind of stuff ahead.
This afternoon we let go of our Saul Centers 6.875% preferred (NYSE:BFS-C) at $25.48. I had picked up a modest position last week when big sellers dumped the share price down to $25.05 (I paid around 25.11 on average). I know quite a few of you got on board as well. This issue will be called soon so the price should stay at $25.60 or below. It is trading around $25.47 right now so it has maybe 15 cents of call risk in it (assuming a 30 day notice is given). We just wanted a 1 or 1.5% gain so we got it and we are out.
Also we note that ‘fake utility’ Just Energy (NYSE:JE) has been taken to the woodshed bigtime. Looks like their 8.50% fixed-to-floating preferred (NYSE:JE-A) has taken a $6/share haircut since Wednesday and is trading at $17.24. So far the peer Spark Energy 8.75% fixed to floating rate has not fallen much in sympathy. I no longer hold much of the Spark Energy issue–it took a long time to get a meager profit from that ‘fake utility’ and I am not made for those wild rides.