Maybe Good for Your Watchlist?

As I keep searching for good buys I keep coming back to some old standbys, but on occasion come upon something I had missed.

Below are 3 issues that would be attractive to some who are looking for some price stability, although in some cases, maybe giving up a little yield.

One that I own and keep coming back to is the Oxford Lane Capital 6.75% term preferred (OXLCM) that has a mandatory redemption on 6/30/2024–about 2 years from now. The issues has fallen off 40 cents in the last week or so and today the issue has traded down to $24.90. As it trades below $25 the yield to call moves higher making this even more attractive.

The 2nd issue that is attractive is the RiverNorth Specialty Finance 5.875% term preferred (RMPL-) which is currently trading at $25.13 and has a mandatory redemption on 10/31/2024. This issue has traded down about 50 cents in the last couple of weeks making it attractive. I have owned this one before, but not at this moment–I will nibble today.

In theory any price around $25 or lower should be a great buy as I would fully expect redemptions on schedule–of course ‘shxx happens’ so I can’t guarantee this will occur.

The 2 issues above are closed end funds and so they have to have 200% asset coverage on the preferreds . RiverNorth has coverage in the high 200% area while Oxford Lane is in the 300% area (note I have not recalculated this most recently so potential investors should do their own due diligence).

Lastly I have taken 2 nibbles on the Cowen Inc 7.75% senior notes (COWNL) this week–the issue has tumbled hard in the last week or 10 days to now be trading in the $24.87 area. This issue has a maturity date on 6/15/2033 and as such will tend to have more share price movement with a maturity date out 11 years. On the other hand as it moves below $25 the risk/reward goes toward 8% which is fairly tasty. COWN is not a high quality investment banking firm and their business has been hurt substantially in the last year as investment banking has slowed dramatically.

Once again these are just a few ideas–and not a recommendation.

15 thoughts on “Maybe Good for Your Watchlist?”

  1. Speaking about watchlists. I’m currently using Yahoo Finance but I’m looking for something with alerts and begin able to save notes.
    Any suggestions as to where to look?

    1. jos-
      Are you using your brokerage alerts? Schwab has a great one- even goes to your phone, but no notes.

  2. Grid—I own a lot of this issue and am worried about it. The CEO was, all of a sudden, fired about a month ago without explanation. Not clear if it was a personal issue or something to do with his running the company. Glad to hear that the BB+ rating was confirmed in Feb.

    1. I saw that Randy, but dont know any particulars. The common stock has basically been horrific basically since 2014. But yet the credit quality still has been decent. Hard to figure out these reinsurer types.

    1. Grid, it was actually you that mentioned how they’ve continually been losing money quarter after quarter after quarter that got me thinking to revisit this one more closely…. I’ve been cutting my position down having begun in March with that in mind, but plan to hold the rest with an eye to eventually adding back I don’t need no second QRTEP where I already did the same thing starting reducing exposure in Jan… .ha. You may have also noticed how violently the private money firms such as Third Point have been slapped around this week, so their involvement, though perhaps originally a plus in the merger, may now be a possible drag. Third Point’s relatively swashbuckling approach to investing (Fitch notes SPNT expects to reduce its exposure in Third Point funds and reinvest into less volatile investment) is not helping SPNT’s turnaround efforts right now nor is the resignation of SPNT’s CEO anything but an ominous sign imho… Also, as far as the reset not happening until 2026, 4 years seems like an eternity right now so that fact might make the f/f feature less important as a wat to save SPNT-B from rapidly rising rates today.. I do plan to continue watching this one more closely though, with an eye toward eventually getting back in should their turnaround show more signs of progress.

      1. 2WR, Its just hard to trust these types for much, especially how the common stock is acting. I still remember getting lucky on MH-A, selling before the calamity. CEO said several years ago it was getting redeemed in a few months. Fast forward to now and not only has not been redeemed, its divi is suspended also. At best this would be a two hundred share flyer for me.

    2. S&P also reaffirmed ratings on last month, albeit with negative outlook. And this seems to be trading in line with Enstar pfds, So I don’t think there is a company specific landmine here. Just general distrust in financials during times of stress.

      LONDON (S&P Global Ratings) May 5, 2022–S&P Global Ratings today affirmed its ‘BBB’ long-term issuer credit rating on SiriusPoint Ltd., the holding company for the combined group. We also affirmed our ‘A-‘ long-term issuer credit and insurer financial strength ratings on the group’s subsidiaries (see Ratings List, below). The outlook remains negative.

  3. FOSLL 7% senior notes due 2026 are interesting, traded all over the place today, ended up on somewhat higher volume at 19.80.

  4. I am at the stage where I am thinking of selling my RMPL- to buy other things that pay more. It was purposely bought to do this several months back. I now have two payments in my pocket and in the money. Since it pays approx 5.85% I need something of quality at 6.85% to swap into I reckon.

    Is RIV-A there yet? 😐

    1. Not time for perpetuals yet IMO.

      Russia is tightening energy supplies and there are rumblings that OPEC will do the same. Fed is raising interest rates to cut demand, but the problem is on the supply side and absolutely nothing is being done to help that.

      So the only things I am buying are floaters and shorter term stuff of companies I think will survive until maturity. I think we have a long ways to go yet because there is nothing one can point to that is being done to fix any of this outside of the Fed.

  5. Names like jpm c and riv a might make it. That is if 6% can hold water. Problem is price erosion is carving up most all bonds. Blink and there 23

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