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Yesterday I bought this ET series H $1000 CUSIP-traded cumulative, perpetual, reset preferred:
29273VAN0 6.5%, semi-annual, first call/reset 11/15/26 to 5yy + 5.694%.
There are four interest payments before the reset: May and Nov 2025 and 2026.
I paid a smidge over par at high-priced Schwab plus the accrued interest which resulted in a YTC of 6.0%, not great if called but acceptable. I don’t know the odds of a call; I’m just rolling the dice. At least I don’t have too long to wait. I’d buy more if it traded under par.
r2s—I looked at the trading history on finra. Very few trades under par and I think they were dealers buying from retail sellers in small quantities. If rates spike, for whatever reason, in the next few weeks, I think a buy under par would be a good idea. Thanks for posting. My own investments in the last 12 months have been heavily in $1000 issues—both debt and preferred’s. They are basically buy and holds with good adjustments on the call date.
Whidbey, Have you been buying perps? or maturity dated make whole bonds?
If you have been buying set dates on companies you like, how far out have you went?
Charles—a combination of both. Almost all IG, however I do own some Citicorp issues which are Ba1/BB+ that I bought a while ago at much lower prices. If I like the reset terms, I’m not worried about buying no maturity date issues or long maturity date bonds. To me, they’re the same. I like the preferred $1000 issues because of the qualified dividend.
WI, are there any Citi CUSIPs that you still think are good buys?
Whidbey-
Error correction: The preferred pays dividends not interest.
I’ve been asking myself why I chose to buy the ET reset preferred now. If I wanted an ET preferred, I could have bought ET-I with a CY of 7.2% and bought the reset preferred later. My reasons were I wanted to grab par while I could , and I miscalculated the YTC…LOL.
If it does trade below par, I think I’ll investigate ET’s propensity to call its resets. The only way I can think of to do that is to read old press releases. Ideas?
rocks,
Both the company’s website and last year’s 10-K list Preferred Series A through I and disclose their redemptions of ET-A through -E.
https://ir.energytransfer.com/preferred-equity
Also, here’s the result of a search (keyword “redemption”) on their website:
https://ir.energytransfer.com/search?query=redemption&f%5B0%5D=type%3Anir_news&op=Search
You can ask their Investor Relations department if they redeemed any others:
InvestorRelations@energytransfer.com.
mbg Quantum lists the ET-PI as a 144a stock? has anyone tried to buy it lately.
Charles-
Yes, ET-I trades freely.
YH,
IIRC, ET-I is not good for IRAs. It throws off UBTI.
I have owned other ET preferreds over the years (incl. in IRAs) and haven’t had any tax issues.
Charles, IIRC, ET-I is a 144, but it is an odd issue.
It wasn’t issued by ET “in the normal course” – it was issued as part of an acquisition to replace an issue of an acquired company, so it doesn’t follow the “rules” for other ET preferreds. For example, it throws off UBTI, which (most, maybe all?) other ET preferreds don’t.
The conversion terms for Energy Transfer’s Series I Fixed Rate Perpetual Preferred Units (ET-I) are as follows:
Optional Conversion by Holders: Holders of Series I Preferred Units can elect to convert all or a portion of their units into Energy Transfer common units, provided the aggregate value of the units being converted equals or exceeds $20 million or the remainder of the holder’s Series I Preferred Units. The conversion ratio is initially set at 2.07 Energy Transfer common units for every 10 Series I Preferred Units. This conversion is subject to payment of any accrued but unpaid distributions up to the date of conversion2.
Conversion in Liquidation Events: In the event of Energy Transfer’s voluntary liquidation, dissolution, or winding up, holders can convert their Series I Preferred Units into common units at the applicable conversion ratio, again subject to payment of accrued but unpaid distributions2.
Conversion at General Partner’s Election: The general partner may elect to convert all or a portion of the outstanding Series I Preferred Units into common units if specific liquidity conditions are met. This includes a requirement that the volume-weighted average trading price (VWAP) of Energy Transfer common units over 20 out of 30 trading days exceeds a threshold price (initially approximately $66.14 based on the initial conversion ratio). This conversion is also subject to accrued but unpaid distributions2.
These terms are detailed in the partnership agreement and are subject to adjustments as specified in applicable agreements or conditions.
Thanks, mbg. I will post the redemption history.
Do the ET preferreds pay “distributions” which have a portion of dividend, a portion of return of capital, etc.?
New stuff for me and interesting topic…
Whidbey-
Error correction: The preferred pays dividends not interest.
Are you referring to ET’s preferreds?
They don’t pay either. They generally pay “guaranteed payments”, which appear on the K-1.
But I think Whidbey was referring to 1000 Preferreds in general, like this one:
https://www.sec.gov/Archives/edgar/data/831001/000119312525021394/d926066dfwp.htm
i think this is a good buy. I have 38% of my preferreds that are fixed rate reset. Excellent reset rate. Maybe it gets called but if it does 6% works for the next 21 months
I bot sce/prj ftf 9/15/2025 sofr +300 at 22.85..assuming in trades near parity 25 ytc 21% ..traded at 25 in november
Mj welcome aboard, I hope we don’t have to start bailing this leaky tub. I have followed SCE for years and past history is no indication what might happen in the future. I remember H and F and I think even E. One of these had partial calls before being fully called if my faulty memory is correct.
I’m taking a risk granted., but I don’t think they will go BK but you never know. I do know that if they are suspended it would hurt but not the end of the world.
TRTFF, the latest OTC version of TRTN-F (7.625% preferred), printed 24.65 this morning.
The CY for TRTN-D is 7.6%.
R2S they seem to keep printing the preferred oh I meant money. I don’t see where Brookfield has called any of the outstanding preferred. This being shipping which can have a nasty downturn in a recession. Doesn’t look like we are headed for one anytime soon though.
I’d be more interested if it was a term preferred. You see BIP notes? due 2084
7.25% almost at par. I know I will not be around then.
QUANTUMONLINE – For those who have noticed a downward direction in QOLs service recently, there’s now hope….. I know I’m used to trying to send them new info such as notices of call or changes in an issue (such as HTLFP to UMBFP) when I see they are not up to date… In the past they were always gracious to acknowledge the help and quick to update their files… Recently, that’s not been happening (they just updated ANG-A’s CALLED status today when I emailed them the day after the announcement and never received acknowledgement) and I called them out on it. I received this response:
“Thank you for your feedback. We always want to know what our users are thinking.
“We do appreciate your forwarding us information regarding individual securities and I can assure you that your information is being passed along to our research department for review and update. The timeliness of these updates apparently is slipping and for that we apologize. We will look into why this may be happening. The research people are in a different geographic location, so we don’t have the day to day contact one might expect if everyone was located in the same office.
“It has been a challenging few years for QuantumOnline.com unfortunately. The original founder passed suddenly in 2020, and then the business was taken over by his two sons, neither of which knew much about the business. Then about 18 months later, one of the two sons passed as well (the son most involved in running QuantumOnlilne.com). And we have very little contact with the remaining son. In fact, we heard about the other son’s passing via an Internet search.
“And, for whatever reason, the financial contributions to the website have tapered off as well, making it more difficult to properly staff the research department as well as make technical updates to the website. Hopefully, we can right the ship and get back to where the website was previously, however, there are quite a few headwinds at the moment.
“We appreciate your patience as we work through this process. Please continue to send us any updates and we will do our best to incorporate them as quickly as possible.”
Like Tim, these are good people and their service deserving of contributions, both financial and information wise.
apologies for putting this in Reader Initiated….. I was aiming for Sandbox and don’t know how it ended up here…..
2WR it shows you posted late my time. Must be even later East coast time
I did a little sleuthing awhile back and the QOL website address tacked back to what I thought was an older gentleman living in a house in Florida older than he (or is it him?). It’s at that point I was thinking it’s a 1 person show. I’d doubt there is any “research department.”
On the internet you can be anything you want if you have a cool website. As an example I found a mysterious-sounding hedge fund one day years ago…but it tacked to 2 intelligent high school kids in Farmington , Mich.
To make a long story short, they both went off to college and at graduation, wanting good jobs they had to scrub every vestige of anything inappropriate.
That website , which indicated they were mysterious Russian billionaires who invented pubic follicular arrangments had to go …. Well, they did SPEAK Russian as well as English.
Anyway, one ended up with a double major in econ and music at Duke on a full ride, worked in IB for 2 years then got a PHD in music from Yale on a full ride. He moved to Moscow. Worked for McKinsey there until they shuttered that office. I always suspected he was working for the CIA because he was fluent in English, Russian, German, and French .
The other kid graduated from Michigan business school, then ran a trading firm for years before inventing a nonsense stablecoin . He made $63 million on that. Both are now mid 30’s.
So, reality turns out to be somewhat more odd than fiction.
losingtrader, this site and Quantum offer valuable information put out by some dedicated people. It’s hard to find someone else who is as dedicated to what to you is your passion.
I belong to a group loosely connected to other groups across the nation dedicated to the hobby of grafting and saving rare fruit trees from extinction.
As the folks who founded the group grew older it became harder to keep up year after year. They realized they needed to get younger people involved. They handed off the torch in the last couple years and in Dec had their annual board meeting. All the positions were open on the board. Not easy running a non profit especially if its a hobby and not your passion.
I knew a guy named Doc Reynolds, from the Reynolds family of Dean Witter & Reynolds fame. a Harvard grad whose passion was collecting books for the blind and distributing them to schools worldwide especially 3rd world countries. People who knew him told him he needed to set up a non profit so the good work could be continued. He refused for a number of reasons. One he said he didn’t want something that was more of a business than a charity.
That deserves a movie !
Gary, he was a professor at UC Davis, His students loved him. He always had stories to tell. Consider the people who he went to school with at Harvard. He knew the prior king of Saudi Arabia. Told me a story about shipping braille books there and how he got help doing it.
Google what was the first mainstream magazine to have a Braille addition.
Blackrock Muni income closed end Fund, MUI will convert to an “interval fund” later this month. Essentially this is a conversion from closed end fund to an open-end fund with limited quarterly liquidity “windows”. Nav = 13.33 and shares can be bot today ~12.10. Shares will be delisted with last day trading NYSE on 2/14. Port manager states income should remain the same or slightly better even though leverage will be eliminated as charter will allow for high yield muni bond portfolio inclusion. DYODD
Very interesting. Do we know what he average NAV discount is for muni funds? I’d expect a sell imbalance of some type on the last day.
I’d buy and hold if a big enough discount
tey cefconnect.com, it may provide the NAV for each fund.
AmTrust Announces Quarterly Cash Dividends on Preferred Stock
NEW YORK, February 5, 2025 – AmTrust Financial Services, Inc. (“AmTrust” or the “Company”) today announced that its
Board of Directors has approved a cash dividend per share on the following series of non-cumulative preferred stock:
Series Rate Dividend
A 6.750% $0.421875
B 7.250% $0.453125
C 7.625% $0.476563
D 7.500% $0.468750
E 7.750% $0.484375
F 6.950% $0.434375
The preferred dividends will be payable March 17, 2025 to stockholders of record on March 1, 2025.
Thanks Fabrib
Charles, did you have any opinion or ownership of the PSB series?
I see the endless buyer at 13.14 is gone
Lt, you had to ask me a question I hadn’t needed to think about because I wouldn’t buy them. Crazy for someone who buys SCE preferred.
This is my reasons.
First off they are perps. but cumulative, so they never have to be called.
There have been some buyout offers by the Private Equity company but way under Par. instead of 25.00 I think there have been offers around 16.00 to 18.00 there is speculation by investors not proven that if they can buy out enough of each preferred they can quit paying. People also say the Private Equity will not support any buyout companies, they have to stand alone and earn their keep.
Second reason I haven’t considered them is who opens them. Blackstone.
Just my impression of them and Brookfield
Consider this is a business park Reit. What was their debt before they were bought? has the good properties been stripped out and sold to another Blackstone Reit or the opposite and this REIT is one of their main vehicles they use to own business properties with? Is there a possibility they move poorly performing other properties into this holding? it’s possible.
P.E. is known for short term borrowing to buy a target then load it up with debt to pay off the short term loan. They are also known for installing their own management and charging a management fee when the company didn’t have to cover this out of profits before when they were independent.
There are other tricks like slicing up all the assets. Like selling the buildings to another Reit they own and make the business pay rent.
I’m not saying Blackstone is doing any of this, but why take the risk for 2 or 3% more? You can try buying REXR-PB to get a 7% return and sleep better.
If anyone is holding SCE or contemplating a purchase, you might find this informative. Personally, I’m staying away.
https://newsroom.edison.com/releases/edison-internationals-utility-southern-california-edison-submits-reports-on-eaton-and-hurst-wildfires-to-state-regulators
MarkS – I concur. For instance, I would take newly issued FGSN over that all day, still a few pennies under par here @ 7.30% yield. Company has $4B cash vs. $2B debt, levered free annual cash flow of nearly $2B. And they part of FNF.
Mark it’s difficult to get an accurate estimate of cost for the Hurst fire. Edison admits their equipment started the fire and it was contained to approx. 800 acres with a lot of the burn area in the Angeles national forest.
When I googled it, AI was completely useless. It wanted to include the estimated cost of all the wildfires that occurred in Southern Ca.
Charles,
Just by looking at a map of the burned area for Hurst shows very little in the way of actual destruction of property. Like buildings, homes, etc… Hurst is not the worry at all. It never was once contained which it was in early days compared to the others.
I have a feeling you know this already though. It is so inconsequential nobody really cares to add up the numbers yet. The other fires are much more “sensational” and head line grabbing.
The order the fires started in may matter. For instance, if the smaller one strated first due to SCE negligence then embers from it started the rest I imagine that would be a different situation than if it started later.
Liability can be difficult to trace. I am sitting tight right now and if things go badly I will double down on everything at some point and just wait it out.
Of course, my plan may change tomorrow ;o)
The Hurst fire and Eaton fire are more then 20 miles apart.
Eaton fire first reported around 6 pm.
Hurst fire first reported around 10 pm and 20 miles from Eaton per fc.
Interesting to read the two risk profiles III’ers have for SCE preferred’s.
Charles take your pick:
AccuWeather estimated that these fires could result in damages and economic losses exceeding $250 billion.
JPMorgan analysts projected that insured losses from the fires could surpass $20 billion, setting a new record for wildfire-related insurance claims in U.S. history. They also estimated total economic losses at $50 billion.
From Vox.com:
Verisk, a risk analysis firm, calculated that insured losses would total between $28 billion and $35 billion. CoreLogic, a property analytics company, put that bill between $35 billion and $45 billion. Economists at the University of California Los Angeles pegged the insured losses at $75 billion.
Dan, sitting on about a 5% loss on my SCE Trust preferred not counting interest. With returns it’s less than that 5%.
I lived with the 2018 and 2020 fires in Northern Calif. I bought PCG after it was sure they were coming out of BK and going to pay the suspended dividends and after the dividend collectors got that big pot and sold and moved on I bought.
This time I am taking a risk buying before the smoke has died.
haha nice name, Mark S
Re: SCE
The last 2 years the dividends were declared on the 4th Thursday in February.
This year the 4th Thursday in February is on the 27th. I see EIX common as a test case. With a prolonged investigation ahead it seems too premature to adjust the parent dividend (EIX common) which could be interpreted as a tacit admission of guilt ???? Far too early to write down destroyed assets in the balance sheet???? Maybe at the end of the first or second quarter????? JMO. Lets hope EIX common is not the canary in the coal mine.
Private may well have it right in his post. He is a really smart guy. I respect his opinions.
Has anyone considered the SCE Trust VII 7.50% Trust Preference Securities? I am considering a purchase wanted to check in with the experts first
I have been buying M and J. I am not an expert and according to my wife I barely know what I am doing.
Some EIX bonds briefly hit 6.9% YTM earlier in the week now are back down. These are make whole but junior to the SCE I think someone said. Full up on tranches of SCE and in the black only on the L but then I mainly bought for the income.
(Fc’s comment is great!)
I bought the SCE Trust VII the morning after it bottomed, then sold it 11 trading days later. I intended to invest in it, not trade it, but as I followed the story I chickened out.
I also bailed on all my SCE Trusts yesterday
I sold mine.. California is sue happy…other comparable yields..
OK, what are the comparable yields? Utilities only please.
David,
There isn’t much to compare with it. The best you can probably do is 6.5% when there is a dump into your bid. But once again those other UTEs are not currently dealing with fire damage and lawsuits. We have to admit to ourselves we are dumpster diving with SCE and taking on considerable risk. But after PCG and HE.. the end result for preferred holders.. I am feeling frisky enough to dive in.
fc, I just finished twisting Fidelity’s arm to let me place an order for a PCG preferred at a YTC of 7%. If it hits, good. If not I’ll continue to collect 4%
I have bought both EIX and PG&E bonds in the last week. Holding for the income and NO, I’m not concerned about any repercussions from the fires. Those of you who’ve sold recently…thank you for the extra yield. What you’re all missing is state law that limits a utilities liability and that allows the utility to recover liability cost through rate adjustments. It’s all part of the wildfire legislation passed after the PG&E fiasco of a few years ago.. The utilities bond holders simply won’t take a hit from wildfires.
I figure when there is a definitive statement that SCE was involved there may be a swoon where more shares can be picked up, but if the new liability limiting laws work as they should it won’t be much of one. They might even go up if it is clear that the exposure is limited so I have only nibbled here and there, but have kept some powder dry in case the bottom falls out. PCG preferreds absolutely tanked when they had liability. That was a good chance to have a big gain if one was comfortable with the risk.
I hold only a few preferred issues and none are from California utilities. I haven’t looked at the SCE preferred issues but I’m going to assume they have the standard 5 year interest deferral clause. That clause is why I stick to corporate bond issues.
relative to vclt sce preferreds are trading at all time lows (underperform)
It’s great except for the litigation risk. Personally, I think it will be fine, but I wish we had Grid’s expert opinion
I am obviously not Grid, but he and I used to talk about California utilities a lot. Wish he were around…
I bought the SCE-M, mostly at/below $23. Personally, I am not very worried about it. In CA, utilities are legally responsible for fires they cause (even if not negligent). However, the governor and PUC (who are both firmly in utilities’ pockets) won’t let anything hurt the utilities.
In the last few years, for example, Pacific Gas and Electric has been through BK twice because of fire liability (and they are a convicted felon because of their behavior), but their preferreds/bonds didn’t suffer at all. In fact, they mostly went up.
The State has funds in place to backstop utilities’ insurance, and our idiot governor went so far as to strongarm the victims of the 2018 Camp Fire (burned whole towns, killed 85 people) into accepting that the victim compensation fund would be funded primarily with PCG common stock! So, victims only get paid in full if the company that destroyed their homes and killed their relatives is successful.
I expect that behavior to continue. The state says it can’t let the utilities fail and they need the utilities to remain financially strong enough to invest for our future (so they say over and over).
So, I buy SCE and PCG preferreds and debt while mr. market punishes them.
Dan ; I bot 1000 sh of this on Jan 16th ; I’m down a full point; I mentioned
here i thought it was a “no brainer” and I still do ; there seems to be little chance even the Parent will need to reduce it’s div. ;
from my research ; this post is simply to tell you what I did and not meant
to influence your decision in any way .
The temp ticker for TRTN-F changed from TRTFV to TRTFF.
https://www.otcmarkets.com/stock/TRTFF/overview
TRTFF
Triton International Limited
Preferred Stock – PREF SHS SER F
Penny Mac 9% Baby Bonds, symbol PMTV, incoming. Still not showing temp symbol on Daily Additions list.
Fan59,
My understanding is that unlike many preferreds which trade briefly on OTC w a temp symbol, when a debt instrument (e.g., a baby bond, like PMTV) begins trading, it only begins trading with it’s permanent symbol, and only on it’s regular exchange, like the NYSE – often several days after it comes out with the FWP term sheet. This morning, I checked w my broker Fido about buying it via it’s CUSIP. They told me it only becomes available on the secondary market on the settlement date (Feb 11 for PMTV) and to call them then. They’ll check their inventory and if they have some available, they’ll tell me the bid and ask.
Thanks, mbg!
Not using a temp symbol — per the info sheet Tim posted today.
NewtekOne…
Any IIIer’s familiar with this company or its Baby Bonds
(NEWTG, NEWTH, NEWTI)…assuming higher risk with higher 8.0 – 8.625% coupons.
Small company. Good management. I own reasonably small amounts of all the baby bonds, and bought more NEWTZ today – decent YTM with a good probability of safely making it to maturity. NEWT has been a long-time III favorite even back when it was a BDC before it changed to a bank holding company. Still, DYODD.
I own NEWTH and G
i think the risk is the same ; the differing coupons are strictly based on what they have to pay on that date to get it done ;
NewtekOne…
Any IIIer’s familiar with this company or its Baby Bonds
(NEWTG, NEWTH, NEWTI)…assuming higher risk with higher 8.0 – 8.625% coupons.
good article(s) on S/A..most recently 1/5 by stephen nemo
I like it.. it’s balance sheet is still more like a BDC..
NEWT started out as a BDC then bought a bank. Not sure if it was a shell co like a SPAC or just a one branch pony. When they converted a lot of people holding the BB thought they would have to call them. Made people upset when they didn’t. As for being a bank now, how many branches have they grown to? I traded in and out of them when they were a BDC and was tempted to get back in before they converted to a bank. I guess people have done well with them.
DLNG-A (9% cum preferred, callable) ex-div tomorrow for 56 cents. Last 25.45. Now I have a little ding-a-ling.
I bot dlng.pra at 25.45 (24.96 stripped) the dlng.pra.vlct pair is trading near fair value.. was two sigma rich on 1/14 and 2 sigma cheap on 9/17 ..good article on S/A dated 1/18 by the “investment doctor”..tks for show
Wouldn’t the stripped price have been 24.8875? (0.5625 div )
this goes back to the difference between exdate and pay date… so why I will get 56 cents I wont get it until 2/12 ..this 7 days is worth 4 cents so i the stripped price is 24.93 (not 96)
Not sure what that has to do with the stripped price since you get the full div.
oh well….
I felt EXACTLY the same way but it was proven to me by independent third parties (quantum.com) to be the case
I just sold dlng/pra at 25.07 which I acquired yesterday at 25.45 picking up about 13 cents ..the reason for my sale is my pairs analysis indicates it trading near fair value ..will look to acquire cheap or possibly look at floater
one thing to be aware investing in MLP preferred
you will get a K-1with it under line “guaranteed payment”
so consider it ; just the added hassle and cost of reporting on your tax return ;
ETpI is below its usual range.
that’s a keeper ;; no maturity date ; no call date – a strange one for sure
It appears to me ET could cause ETpL to convert anytime they want? I have to admit never digging into this. I simply own ET directly.
fc, I don’t have the numbers ready to hand but the conversion is dependent upon share price of the previous company (since this was a carryover from an acquisition) and back when I bought the probability of hitting those numbers was very unlikely. If I can dig them up will post.
NSA-B seller right now offering shares @ legit 7% yield.
theta-
Legit? NSA-B has been trading ~7% for a couple of weeks. What am I missing?
The spreads on NSA-B are typically massive with terrible liquidity.
If you pay anything > $21.20 it’s under 7%. Sure you can place an under bid but that will most likely go all day without getting hit.
My alert was specifically for someone, with cash to deploy immediately, right now, you can go in and smash that ask and lock in 7% without having to place a low bid, etc. and hope for a fill.
Since my initial alert, notice it only took 1100 shares and now that $21.20 seller long gone. Ask is now $21.53; jumping a whopping 33 cents!
I believe the genesis and true spirit of this page is actionable items that can be had right now, in this moment. No offense to anyone but some of the posts here could placed in the Sandbox. For context I’ve been drinking cask strength rum all afternoon so please don’t take umbrage, anyone.
I have a long winded post on bitcoin I am going to compose at some point that I think some folks will find value to. Maybe that will be on a vodka day. Cheers.
No offense taken Theta. But I don’t think comments related to a specific post should be posted elsewhere. One person questioned buying something with low volume, which you even posted was only 1,100 shares and average volume is around 2,500 shares. Anyone with an account at Fidelity might have problems with selling if they want to.
Charles M – I wasn’t referring to a reply to my specific post which was a timely alert to be posted somewhere else. That’s all fair game and logical.
I was just making a more broad observation, meaning a new first post in here for an actionable item that can be traded right now or imminently.
Theta it’s a good point. I notice a lot of posts not related to a specific topic go off in the weeds.
I’m guilty! Just look this comment!
good comment.. do you have link describing what the structure is on these (i.e. perpetual, cumulative, callability, etc)..fido does not
mjtroll – Sure thing. They are cumulative/perpetual.
https://www.sec.gov/Archives/edgar/data/1618563/000162828023032274/september2023-424b7prospec.htm
tks its seems as as if they are not callable until sept 2043?
mjtroll – Yes, correct.
Good Alert on NSA-B. Unfortunately it is a nanny stock on Fido, but it could make a good flip if the 21.20 offer lifts.
No prob doing a 100sh test at 21.16 – what’s the nanny part- don’t see it. Or is it for a sale or larger qty problem?
Exactly Jteader, hotel California ” you can check in but you can’t check out”
I am almost sure I read somewhere the class B stock was created for the insiders to get income and be able to cash out. This is why there hasn’t been a lot of volume on trading. So now if there is a large amount coming to market maybe someone wants to reduce their position.
The one year chart shows a slow decline in the common stock price and so does the 5yr. Chart
Theta, I might want more than a 7% return on my money as an added cushion against capital loss.
Charles M – I’m going to queue up a some Eagles right now. Thanks! I hear you on the chart and being mindful of proper risk compensation.
Keep in mind, just toss 2021/2022 entirely because that was an anomaly. Putting that aside, the trading range on the common going back to say 2017ish is not too terrible.
This company although the smaller entity in the space vs. PSA, CUBE etc. they are in 40 something states. They recently did have a slight downtick in SSR due to slight decline in occupancy. But one indicator I watch closely is FFO and the most recent data is on a year over year basis, it’s still up >50%.
The company also overall has a pretty decent smattering of debt maturities that are strategically spread out so I don’t think you’d have an issue on the cash flow/liquidity side etc.
Lastly they do have the I think a payout ratio at 90% or > totally covered on the common divi. But to your point, absolutely, for any of my perpetual holdings that are not JPM, MET, PRU etc. anything below that class, I am always monitoring and assessing quarterly ER etc. You really have to.
Also appreciate your kind words above. Cheers and a good 2025 to your investment goals.
Sir, I’ll have what your drinking
Just what you posted here is worth the discussion on Tim’s site.
I have held NSA-B off and on since it was first mentioned on this forum last year. I hold it now and find it attractive (at 7%) for tax adv accounts. As others have mentioned, it has protective change of control terms, which could come in handy if they are bought.
Speaking of change of control risk, did anyone notice that cedar just did a meaningful tender for their prefs?! Amazing…
agreed .. I don’t get all the angst about whether it should have been posted on this blog
Issuer / Ticker:
PennyMac Mortgage Investment Trust (“PMT”)
Guarantor:
PennyMac Corp. (”PMC”)
Description:
$25 Par 5NC2 Senior Unsecured Notes
Expected Security Ratings*:
Egan-Jones = BBB+
Format:
SEC Registered
Maturity:
February 15, 2030
Settlement**:
T+5 (February 11, 2025)
Denominations:
$25 and multiples thereof
Announced Size:
$50 million (2 million $25 par notes)
Price Guidance:
9-9.125%
Coupon Structure:
Fixed-for-Life
Payment Dates:
February 15, May 15, August 15 and November 15 of each year, beginning on May 15, 2025
Optional Redemption:
In whole or in part, at any time and from time to time, on or after February 15, 2027, at par
Change of Control:
101%
DRD / QDI Eligible:
No
Use of Proceeds:
To fund PMT’s business and investment activities, which may include: the investment in subordinated bonds from PMT’s private-label securitization activities and other mortgage-related securities and the acquisition of MSRs; funding PMT’s correspondent lending business, including the purchase of Agency-eligible residential mortgage loans; repayment of other indebtedness, which may include the repurchase or repayment of a portion of PMC’s 5.50% exchangeable senior notes due 2026 or secured financing; and for other general business purposes
Joint Bookrunners:
MS (Physical) / GS / RBC / UBS / WFS / KBW / PIPER
Expected Listing:
NYSE
CUSIP:
70931T707
Anyone with PMTU 8.5% matures 9-28 may want to sell its currently @$25.49
qxjm76940–Wish I would have done that yesterday–but no crystal ball here.
No kidding. Where is my crystal ball when I need it.
Thanks- got out at a long term profit & a bit of a profit today.
Thanks EB
given PMT screwing over the holders of PMT-A and PMT-B by declaring that the switch from LIBOR to SOFR means that instead of floating they are now fixed I will never touch a PMT security
PMTV incoming
https://www.sec.gov/Archives/edgar/data/1464423/000119312525019693/d918872d424b5.htm
9-9.125 No mention of redemption with use of proceeds except for 5.50 notes due in ’26.
As of January 31, 2025, PMC had $345 million aggregate principal amount of the 2026 notes outstanding. The 2026 notes bear interest at an annual rate of 5.50% and mature on March 15, 2026.
Thanks J
Lately, it feels like every post has turned into sandbox material with speculative comments like “The president is going to do this” or “Mexico will respond by doing that. Last night on the squawk box, I heard…” How do these random squirrel speculations relate to trading alerts?
If I wanted to read opinions from talking heads, I already know where to go for that. Can we keep this thread focused and relevant to trading alerts.? Ex. Things people are buying or selling, new investments, called investments, etc. Other random thoughts should be dumped to sandbox.
Mr Conservative,
You are correct. Function of me posting in the wrong place
amen..but don’t hold your breath
Bank Bond Monthly Payers Today…
* BAC ~ 06055JHR3, 5.5%, 96.91, Senior, A1/A-, Monthly, YTC 5.761% 12/16/27, YTM 5.761% 12/16/44.
* GS ~ 38141EX79, 5.85%, 102.33, Senior, A2/BBB+, Monthly, Non-Callable, YTM 5.631% 6/15/41
I feel like we are replaying the movie Canadian Bacon:
https://en.wikipedia.org/wiki/Canadian_Bacon
Bloomberg: Mexico’s Sheinbaum Says Tariffs Delayed For One Month
All good now?
Oil down a bit, the 3mo rate is higher than the 2yr….
So far, delay is only for Mexico.
Mexico has agreed to put 10,000 troops on the border and there are meetings set up to make a longer term deal with Rubio heading our delegation.
I am not sure Canada even has anyone in charge who can make a deal right now with the parliament prorogued while they try to replace the PM. No one seems to be running the show up there so we might see more uncertainty for a while longer on that front.
I would have thought the pipeline companies would be good to watch for opportunities but oil seems like it will get an exemption so I am just sitting tight. So far, all of my accounts are up today and I don’t see any actionable items. That could certainly change though.
Last night on the news they said oil from Canada would have ‘only’ a 10% tariff – pretty good sized impact on gas prices here. Hope not.
Also, yesterday, POTUS says he now is in agreement with Powell on holding rates steady rather than demanding a raise. Maybe that will help the fidgety mkt.
POTUS cannot influence the decision as far as I understand, right?
and the US has “agreed” to restrict the flow of weapons to Mexico
Moved this information from Sandbox to Reader Alert. A new offering from Berkshire Hathway (subsidiary Berkshire Hathaway Energy). Utility Company Nevada Power 6.25% coupon rated BBB/BAA2 from SP and Moodys. $100 issue. Baby bond. Trades by cusip only. Purchased by calling the Schwab bond desk on Friday.
FWP:
https://www.streetinsider.com/dr/news.php?id=24273917&gfv=1
Prospectus:
https://www.sec.gov/Archives/edgar/data/71180/000110465925007427/tm254537-1_424b5.htm
Thanks to 2whiteroses for finding the prospectus. Team effort
This is a 5 year fixed rate reset. The initial coupon for the 1st 5 years is 6.25%, then it resets to 5 YR CMT + 1.936%
Thanks, Steve.
Nevada Power, or NV Energy I believe is legally mandated to move to 50% solar. I recall a vote on this .
https://www.utilitydive.com/news/nevada-passes-bill-for-50-renewables-by-2030-100-carbon-free-by-2050/553138/
5yr treasury constant maturity (better known as the “weekly average yield on 5 yr treasury securities adjusted to a constant maturity of 5 years” ) plus under 2% is not attractive to me.
I used to service an extremely large portfolio of adjustable mortgages with over 70 different types of indices . I looked up exactly how the CMT is determined…and it was decades ago I did this, but they take closing market bid prices of 5 yr treasuries no matter when they mature and adjust to a constant maturity. I never investigated how that’s done. Too busy fixing improperly adjusted mortgages. I was part of the group blowing the whistle on mortgagees back offices not understanding how to properly adjust millions of mortgages. That was a function of very uneducated employees.
It’s way off-topic but you might find it interesting that an employee in charge of billions in adjustables was question on how she decided WHICH day’s rate was used for adjusting . It was supposed to be based on “the most recently available index,.” She decided years earlier that “most recently available” meant the day she received the paper H15 release in the mail
Lt, I rode a 30yr adjustable all the way down and paid it off. Was when they first came out. San Francisco federal savings and loan. Based off North Coast district cost of funds. Could only be adjusted once a yr and no more that a 1/2% up and max was like 10% When SFD were bought out the merging bank sold the loan. Seemed like my loan was always packaged with the first batch of loans to be sold. Lost track of how many mortgage servicing companies I was moved to. The last one was a sub of New Rez. Every statement I got said my interest rate was changing but the amount to pay interest and principal never changed until the anniversary date. 98% of the time my loan went down until I was paying like 3-1/8% at the end.
I look back on it as the good ole days. I don’t think we will see rates as kow as that again.
Charles
More ancient history….
Bought our first house in 1981 – 16.5% 30 yr mortgage
Refinanced 7 times.
Last was in 1997 @ 5 1/4%
Interesting factoid to anyone thinking about buying a house today:
Bought for $180, sold for $620.
During the 16 years we owned the house, we put $100 of additions into it.
Our mortgage payment in 1981 on 16.5% on $180 purchase
“Roughly” equalled
Buyer’s 1998 5.25% on $620 sale price
after cost of improvements factored in…
What happens to today’s house values if/when interest rates go the other way?
SHEINBAUM SAYS “GOOD” CALL WITH US’ TRUMP LED TO SOME ACCORDS, MEXICAN PRESIDENT SHEINBAUM SAYS TARIFFS ARE PAUSED FOR A MONTH FROM NOW. (BBG)
So, after a fashion, Berkshire Hathaway (Energy) does pay divs – they’ve owned NVE since 2013… ha!
Monday Post-Tariff Futures at 4am EST. Let’s see where Mr. Market finishes today!
Dow ~ (-554)
Nasq ~ (-395)
Did anyone receive a notice for SBBA full redemption? Fido sent me a notice for a 3/3/2025 call date. About 4 months before the 6/30/2025 maturity date.
In the past I’ve had a couple erroneous notices (e.g., ETI-, the Entergy Texas 5.375% preferred), so I like to get corroboration. I checked for SEC filings and for announcements on the company website, Seeking Alpha, and yahoo finance. So far, no corroboration, so I’m not certain of it happening.
It could be valid – STNG recently issued bonds in the Nordic market, and refinancing SBBA was the main planned use of the proceeds. Still, I figured it would be for when it matures, not for calling it 4 months sooner.
https://www.scorpiotankers.com/scorpio-tankers-inc-announces-successful-placement-of-5-year-senior-unsecured-bonds/
Gumfighter, now I see your post. Hopefully we’ll get corroboration from a source besides Fidelity.
In reading through the prospectus, it appears they are only required to give 30 – 60 days notice of redemption.
Schwab has not sent notice of redemption, although their research page shows 3/2/25 as the next call date, but that’s just their standard boilerplate.
If redeemed on March 3rd, did I calculate correctly that full redemption amount will be $25.29 ish?
The conspiratorial side of me wonders if there is any “odd” trading that happens with these securities that Fidelity erroneously flags for redemption – buy / sell imbalances caused by holders liquidating prematurely.
On the other hand, Fidelity was “Johnny on the spot” with the recent TRINL redemption, sending me notice that day AFTER funds were deposited from the redemption that the security was going to be redeemed…….. ugh.
Oh, I just see now that Schwab has as the security description
SCORPIO TANKERS IN 7%PFD**CALLED** @PAR EFF: 03/03/2025
The caveat on 30-60 day notices of call is that although most everyone does the investing community the courtesy of making the announcement publicly, officially I think the requirement only means they have to notify DTC or the equivalent to satisfy the requirement… We’ve seen it before where what you get from Fido or someone else is accurate even if not corroborated by similar info being provided by other brokers…
Everyone, SBBA’s IR replied to me:
Michael,
Yes that’s correct we will redeem the notes.
Best Regards,
______________________________________
James Doyle, CFA
Scorpio
1 Lafayette Pl Greenwich, CT 06830
Dir: +1 203 900 0538 | Mob: +1 203 520 3457
Email: jdoyle@scorpiogroup.net
Mark,
I also calculate 25.29ish. I get 25.30625
63 days accruing (12/30/24 through 3/2/25)
– Final interest payment began accruing 12/30/24 (pay date of prior payment). Accrues through 3/2/25 (day before redemption date).
63 days /90 days (as per prospectus) = 0.7
$0.4375 full amount X 0.7 = $0.30625
prospectus (p. S-50): “Interest on the Notes will be computed on the basis of a 360-day year composed of twelve 30-day months.”
Yes, I also got a notice from Vanguard for a full redemption of SBBA on 3/3/2025.
There was a time I stopped accumulating because they strongly implied on a conference all or two back that they were going to call these early with all the extra cash flows they had coming in but then they didn’t do it. That seemed to be because the shipping market had turned and so they waited for the new financing to be in place that is referenced above. I figured at this point they were going to wait for maturity, but it makes sense for them to call this to save some money. (https://www.scorpiotankers.com/scorpio-tankers-inc-announces-successful-placement-of-5-year-senior-unsecured-bonds/) The net proceeds from the bond issue shall be used to refinance the Company’s existing USD 70.6m senior unsecured notes and for general corporate purposes. I wonder when the new ex date will be.
This the new bond? CUSIP Y754QCAA8
i queried Henrik Alex on S/A who covers IMPP about this and he said that to the best of his knowledge it was not called
SBBA (7% note) full call on March 3, 2025 vs. maturity date of June 30, 2025 per notice from Fidelity.
I own SBBA in my fidelity account and did not see the notice..how did you receive it?
I did not get call notice either on SBBA. Perhaps because it was a recent buy.
mj,
I got an email alert to go to the “Account Records” page, where the notice was posted as a PDF.
On the home page, open up the drop-down menu under “Documents”.
On my home page, “Documents” is one of the headings in the top row, which has these headings: Summary; Positions; Activity & Orders; Balances; Documents; Planning; and More.
In the Documents page, open the drop-down menu under “Other Documents” and select “Account Records”.
tks for detailed explanation..I checked and nothing there…probably because I bot it friday
sure, mj.
Yes – I think that’s why. I bot on Friday but my notice was only for the shares bot before Friday. As we get nearer to March 3, I expect we’ll get a revised notice, and it will show the shares we bot Friday.
NEWTZ – there was a motivated seller throughout most of today and a closing dump down to 25.41 on 10x average volume. NEWTZ matures 2/1/26 and is one of my largest holdings . As of 9/30/24 NEWT had equity of 282M on assets of 1.674M. I’m guessing equity is now over 300M due to the earnings estimate of .66 per share for Q4. At today’s closing price of 24.41 the YTM is 8.05%. Its strange that the safest NEWT issue got dumped today while the longer dated issues I track were up a bit.
another one affected by EOM for PFF I suspect..
B. Riley Financial has briefed its staff on a tentative plan to spin off its securities business into a separate company. (Bloomberg)
any idea what that would do to the preferreds and/or baby bonds? any details? (i couldn’t access the Bloomberg article about it)
good comment.. newtg/sjnk pair went from 2 sigma rich on 12/31 to 1 sigma cheap today going back to inception on 6/3 …newtg 8.5 6/02/29
Microstrategy preferred — flat
https://www.otcmarkets.com/stock/MSTEV/overview
Its conversion clause looks very bad. This one could get dumped soon after listing
Massive dump going on with some of the preferreds. Some are down 2-5%. EOM nonsense.
EoM or the long-term interest rates taking off due to the admin’s imposition of duties on Mexico, Canada, and China?
Sorry Costas. I just can’t believe a 3 basis point move upward in yields would cause preferreds to go off 2-5%. I’m sticking with EOM nonsense. But, of course, stay tuned.
You have a valid point @Rocky_Mountain_Hiker. On Monday we will know better. What I saw was a 5bps rise in the 10Y and a 1.2% reversal in the S&P (6116 -> 6040) around 13:00 when it became apparent that tariffs would be applied.
it’s PFF rebalancing and selling some of its holding to raise cash for buying new issues. On the months that there are multiple large issuance there is usually some selling of existing pfds at the EOM.
EIX
https://download.edison.com/406/files/202501/20250127-eaton-fire-update.pdf
fc, thanks so much for posting that information!!!
Thanks fc. interesting they mention an encampment 300 yards from the site. Even though 220K lines there have been issues like in Oakland of the homeless wiring into street lights and other sources. Of course SCE would still be responsible as they didn’t patrol the lines for illegal access.
Well, Charles, if the homeless were trying to wire into a 220Kv transmission line, there might have been a fire, but there would almost certainly been some dead people.
Back when I was at a mfg plant in the south bay, we had an idiot break into our plant substation yard (4M fence, razor wire on top, etc.) served by a 115Kv line, apparently to steal copper. He apparently touched the wrong things and there wasn’t much left of him but some ash and crispy bits. Our guys didn’t even discover him for several days.
One for the Darwin awards.
fc
I like to hear what the Eaton Fire plaintiff’s lawyers are saying to get a balanced perspective:
January 25, 2025 – Source of Eaton Fire Keeps Coming Back to Edison
A video has surfaced suggesting the Eaton fire, which killed 17 people and destroyed over 9,000 structures, may have been ignited by a Southern California Edison transmission tower. The footage appears to shows blue and white flashes of light, suspected to be electrical arcing, near the tower just before flames erupted on January 7.
Residents near the tower claim to have witnessed large flames at the site, supporting the theory that Edison’s equipment sparked the fire. Edison officials, however, maintain that initial inspections showed no signs of arcing or anomalies and emphasized the need for a full investigation before drawing conclusions. The company confirmed sharing the video with investigators and continues to dispute claims that their equipment caused the fire.
For the full report:
https://www.lawsuit-information-center.com/la-wildfires-lawsuit.html
Another thank you to fc/Steve for sharing the Edison/Lawsuit report updates. It seems
inevitable that Edison will have some material judgement or settlement amount to deal with – at least sharing overall liability for wildfires damages with other entities.
I bought small positions in some of the SCE preferred’s last month. Looking ahead, I am wondering whether anyone here believes their pricing will follow the unhappy example of PCG preferred’s. A long period of depressed values and suspended dividends. TIA
Steve,
IMHO, the site you reference is just a site for plaintiff’s lawyers to troll for clients. it is not really a “balance” for anything. They don’t actually know anything. They just post rumors. They are trying to round up potential clients so they can potentially collect a huge cut of any payment.
There is a lot of gamesmanship among lawyers to try to get people signed up early on the chance that there is an opportunity to try to move a case forward as various firms jostle to get class status for potential plaintiffs.
Edison may ultimately have some liability if they caused the fire, but until the investigations are over, all the plaintiff’s bar can do is howl, file frivolous suits (based on no facts) and try to sign up potential clients. we saw this in the fires in northern California (over the last 10 years), and now we are seeing in down south.
Lots of unethical attorneys out there, and they come out of the woodwork every time there is any kind of disaster (not that all attorneys are unethical, but the bad ones swarm like cockroaches whenever there is a disaster).
Private, I agree with you 100%. However the lawyers do have the ability to cause swings in the price of Edison stock and their preferreds.
The worst day of my working career was being deposed by plaintiff’s attorney in the largest wage and hour lawsuit in America. No love lost here.
Also agree with Private’s appraisal and your comment. Given our present court/legal system and the huge loss and suffering in this disaster, the deck is already somewhat stacked, in my opinion.
Reading today’s comments on SCE preferred’s reminds me that the legal slog is predicted to last years. So in the interim, some of the issues purchased last month at the right prices may be worth hanging on to. I’ll keep an eye on them.
MSTR preferred stock got massively upsized to over half of a billion.
It actually priced higher than I thought. I was thinking 75% of par.
Yield is going to land around 10%.
where can I see this
https://archive.ph/lmDjj
Some things to keep in mind on STRK: Since MSTR does not have any earnings any dividends will be treated as return of capital, also highly likely those dividends will be paid in MSTR stock not cash, conversion premium is massive so STRK will trade as very low quality fixed income. A Ponzi on top of a Ponzi.
Chris W,
At this point I should say, ” You really don’t understand Bitcoin! May I send you some youtube videos that will explain it to you?”
My BTC friends in Portugal believe the higher bitcoin goes, the more they are correct about it taking over for all fiat.
Maybe , but at least you can drive a Fiat.
Perhaps someone with crypto acquires the brand and renames it the Bitcoin
Well the skeptical me says they need enough $$ to pay the first year’s dividend!!
Walgreens has no green, suspends dividend on common…