Monday Morning Kickoff

The DJIA opened last week at the 26,075 level before moving nicely higher to close the week out at 26,424. The 10 year treasury moved in the range of 2.42% to 2.54% before settling on the week at 2.50%. This is a full 10 basis points higher than the close from the previous week.

The FED balance sheet FELL by $20 billion last week–quite a drop to bring the balance sheet assets down to $3.935 trillion. The balance is thought to be headed to $3.75 trillion before the FED ends the runoff–of course we shall see what really happens–no one knows what will happen including the FED chair.

The average preferred stock and baby bond is trading at $24.72 (which is a new measurement–we used to quote just the average preferred stock). There are 226 preferred or baby bond issues trading at $25 or below (again a new measurement).

Last week we had ZERO new issues announced. After having a backlog from the government shutdown during January, coupled with wildly gyrating markets during December and January it looks like new issuance has finally been caught up.

It should be an interesting week in the markets–will interest rates move higher yet? If for any reason whatsoever we see a move higher in rates we could get a little bit of a selling panic by nervous nellies as they look to lock down profits. We would personally be more than happy to see a bit of a setback–25 or 50 cents would be fine, because after the gains YTD that we have already locked down we have plenty of cash to do some buying.

8 thoughts on “Monday Morning Kickoff”

      1. From SI:

        “CPE-A down substantially today after announcing sale of $280 million non-core assets. Announcement included the following:

        The proceeds from this divestiture will accelerate our debt reduction initiatives and also provide the opportunity to retire our preferred stock, reducing our cash financing costs.”

        Drat….

  1. I guess I’ll post this here since the Reader Initiated Alerts section seems closed to comments. Star Bulk Carriers has only one baby bond trading (SBLKZ), which has a 8.3% coupon, a 5/15/19 call date, and a 11/15/22 maturity.

    Star Bulk Carriers Files for $950 Mln Mixed Securities Shelf Offering, Secondary Offering of 48 Mln Shares – 03:54 AM EDT, 04/03/2019 (MT Newswires) — Star Bulk Carriers ( SBLK ) , a shipping company, has filed a registration statement with the Securities and Exchange Commission to issue common shares, preferred shares, debt securities, warrants, rights, and units totaling $950 million and for the secondary offering of 48 million common shares by certain shareholders.

    The company will use the proceeds from the offering for capital expenditures, payment of debt, working capital, and repurchase of shares, among others. It will not receive anything from the secondary offering.

  2. Hopefully they take their time with their plan to redeem SOHOK. Next date of record for dividend is 5/1 than 8/1. SOHOK gets redeemed at 25.25 if prior to 2/15/2021 mature date.

    1. Have to give 30 days notice too right? If my calculation is correct you will get $25.25 plus most if not all of quarterly dividend depending on notice date. Could be small money-maker.

  3. WILLIAMSBURG, Va., April 08, 2019 (GLOBE NEWSWIRE) — Sotherly Hotels Inc. (SOHO) (the “Company”) today announced that it has commenced an underwritten public offering of shares of its Series D Cumulative Redeemable Perpetual Preferred Stock (the “Series D Preferred Stock”). The Company expects to grant to the underwriters a 30-day option to purchase up to an additional 15% of the shares of Series D Preferred Stock being offered to cover over-allotments, if any. The Company has filed an application to list the Series D Preferred Stock on the NASDAQ under the symbol “SOHON.”
    The Company intends to contribute the net proceeds from the offering to Sotherly Hotels LP, its operating partnership, which intends to use the net proceeds to redeem in full the operating partnership’s 7.25% Senior Unsecured Notes due 2021 and, to the extent there are any remaining net proceeds, for general corporate purposes, including potential future acquisitions of hotel properties.

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