Below is the pricing detail on the Hennessy Advisors (HNNA) baby bonds announced yesterday.
Hennessy Advisors runs many different open end mutual funds under the Hennessy name and their revenue is derived from management fees. The company is small, but the financials are relatively solid and I may pick up a little of this issue when it hits the market in the next week or so. While the coupon is a bit below what I want to own the quality is high and the 2026 maturity should keep the share price from dipping too much if interest continue to move higher.
There will be no trading until the issue hits the NASDAQ in a week or so.
The pricing term sheet can be found here.
The company’s website is here for due diligence
Tim…the first call date of 12/31/21 looks like a typo.
Citadel–for sure–will change thanks for the heads up.
The common yields 5.37%, worth looking at I think.
In February I recommended buying AB common over HNNA. Since that time AB has gone up 51.60% vs HNNA 10.16% according to Fido. AB’s yield was in the high sevens at the time and HNNA was in the sixes. AB’s chart looked way better than HNNA IMHO, so I went with AB. HNNA also had some asset shrinkage as a recent TTM trend as well which is no bueno for asset managers.
After saying all that, I thought that HNNA was a conservatively run company. It was just a little too boring for my risk profile at that time for a common stock investment.
Buying some paper from them feels like a no brainer right now if I can buy at par or less. This seems like a small issue to me, so there may be little institutional interest. This could be helpful for the little guy like me. The interest rate is sucky, but that may be good when trying to pick this up under par too. It also may get passed over by the it’s gotta be a TBTF bank, PSA/PSB, or a UTE for me to buy it crowd (also good).
Long-term prospects for HNNA seems meh to me. I don’t really own many mutual funds anymore. HNNA was already losing assets. Unless they hire the next Peter Lynch their best move may be to sell out to bigger shop.
I still own AB, but not HNNA. As always DYOD…
NWGG–boring is good for this type of paper. “i’ll take a little’.