While I didn’t hold any of the issues called today by Telephone and Data Systems (TDS) and majority owned US Cellular (USM) I hate to see 3 baby bonds go all at once.
As noted by Woody, Greg and mbg earlier today the related companies are calling 3 issues of baby bonds.
TDS is calling the TDJ (7.00%) and TDE (6.875%) issues. TDS had 4 issues outstanding so 2 remain. You can see them here. Call date is 5/12/2021.
Us Cellular (USM) is calling the UZB (7.25%) baby bond effective on 5/12/2021.
USM has will continue to have 4 baby bonds outstanding. You can see them here.
All of these issues fell about 1% this morning as they got ahead of themselves and holders will take a small loss of the calls.
I had these issues on my ‘watch list’ for dividend/interest captures, but did not hold any as they were too high in price and we all knew calls were likely coming.
Callable 5/12 with only pennies of accrued that’s a steep negative yield to call on TDI. I think the term to break even is some 140 days.
The flip side is their new U series was a sky high 6 5/8’s whick inked in Feb. So maybe they won’t call. Not worth the risk imo
I am a holder of TDE, TDI, TDJ, UZA. I think TDI would be better to accumulate on weakness, like after ex div. The last time in March 2021 it was suddenly very weak and I managed to build a chunk at around 25.15
Thanks
Does anyone have an opinion as to whether TDI (6.625% coupon) might be a decent investment option now that TDE and TDJ have been called? Trading at $25.64 and yielding 6.45%. It seems that the proceeds from the sale of TDS-U have been allocated for the redemption of these two issues.