7 thoughts on “Ladenburg Thalmann Prices New Baby Bond”

  1. I just dont “get” this company. The genesis of LTS-A in 2013 was they couldnt afford 12% debt they were paying so they “refinance” the 12% debt with 8% preferreds. Poof, suddenly the debt becomes capitalized. But hey its safe because they have no debt. But they dont ever make any profits. But the preferreds are now approaching 2/3 of the capitalization of the common, and now they keep hitting the debt markets too with a frenzy. Yes, they are acquiring assets, but will they bear fruit? Look at the goodwill on the balance sheet. My land its huge. It may pay until the cows come home, but Im not rich enough where I have to buy income issues I dont like, so I am not a player here.

  2. Ladenburg’s financials are a complete disaster. I have a good friend that asked me to look at their preferred and baby bonds for her, because her broker told her they were a good fit for her conservative portfolio. I told her I was quite biased against the company going in, but I would be as unbiased as possible and start by calling the company. I called Ladenburg this week (3 times) and even their IR and assistant CFO couldn’t explain why they keep issuing preferreds at a whopping 8% coupon while interest rates were at a multi-decade low. When I said “why just not issue more equity or very short term debt with lower coupons instead of 8% preferreds or new higher yielding baby bonds”? Their representative told me that “everyone” wants their fixed rate debt and “not to worry that they were over-leveraging their balance sheet”. I will NEVER own any of this companies preferreds or debt. Please do your own deep due diligence before you invest in anything associated with Ladenburg.
    Wishing you profitable investing, Nomad

  3. They came to the market on 5/22/2018 with an IPO LTSF at 7%. Now they are back at 7.25% less than 1 month later. Undermines their investors who brought at 7%. ETP did the same earlier this year. In my view, there is simply no excuse for this and I have zero tolerance for this kind of behavior. Sure – things change. Sure things change, it’s a dynamic world but there are ways to handle this. Let’s use KeyBank recent offering as an example.

    “We may from time to time elect to issue additional shares of Series F Preferred Stock and depository shares representing shares of the Series F Preferred Stock. Dividends with respect to such shares shall accrue from the most recent prior dividend date”

    You can argue if they do that, that investors are being saddled with more debt or expenses but any company can do that at any time. This is the RIGHT way to handle the need for funds versus a 2nd offering at 1/4 to 3/8 percent higher

      1. Ha–I will look into that SteveA–I am actually pretty ignorant on the setup here.

  4. For me anyway, the idea behind preferreds is to get the most yield with minimal risk to principle payments and coupons. Why would anyone ever invest in these? WAY too much risk. There are much, much better 7% (+/-) preferreds out there.

    1. Hi xwords59–I have done some of their stuff in the past – but as a conservative investor they do NOT make me sleep well at night. They will be fine until the economy softens.

      Also the controlling shareholder Dr Phillip Frost, has a net worth of $4 billion–never hurts.

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