Federal Agricultural Mortgage (AGM) has sold a new issue of preferred stock.
The organization has an exemption from registering these shares as they are a government chartered enterprise.
Because of the exemption the normal pricing data was not filed so easily available information is not posted.
Commenter Farwell notes the issue is trading OTC grey market under ticker AGMGP and last priced around $24.90.
The issue carries a coupon of 4.875% and is ‘officially’ unrated—although it is likely investment grade unofficially. The issue is non-cumulative, but qualified.
The company press release can be read here.
AGM has a number of outstanding preferreds which can be seen here.
Stay away from perpetuals
The last pref. AGM issued is likely AGM-F – a 5.25% coupon and first callable in Oct 2025 and also a perpetual with no maturity. It has been trading in high $25s past 3+ months and even wa in $26s many days.
So, even if you do not like perpetuals, this is potentially a good candidate to buy below par and flip for higher ?
Here is chart of AGM-F
You would need the 5.25% issue to trade at about $26.92 to equal the yield of the new issue, so while you might be able to flip it for a little, there probably isn’t much, if any, meat on the bone here.
I am not buying any issues in the 4% range. And that is why my main trading account is about 40% cash now as things keep getting called. I have had no trouble replacing the income through other investments though. Hopefully, that will remain the case.
Thats 95% of my holdings lol
I just can’t seem to pull the trigger on these low yielders. My crystal ball says in 2 to 2 1/2 years they will be trading under par.
I like AGM a lot but at that rate I do prefer to own the common. I bought shares of AGM when one of the previous pfds was redeemed and with the steady hikes in dividend my dividend yield on cost is north of 7%. They have steadily raised the dividend and there is room for more in the future. Lending to farms and rural utilities has been a very good business!