Preferred Stock Investing-The Good , The Bad and The In Between 2015 - 2020

[pig pile]

Bob, dont you dare bring up 5% treasury yield again. [emoji24]It hasnt been there since 2002. You want to talk about a preferred smoking, that would do it. That would drop even my rock solid CNTHP under $40!

And I'd be buying the crap out of it if it did,

 

[MooreBonds]

Well you can feel good as I bought in at $25.15

It's ok, as I figure I'll make some $ either way it goes..

Don't worry, I had picked up 100 at $25.18 yesterday.

 

[Freedom56]

Guys keep an eye on DFS-B (Discover Financial Services Preferred B, QDI Issue, 6.5% coupon). The dividend has been declared per the press release:

The Board of Directors of Discover Financial Services declared a quarterly cash dividend on its Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series B, in the amount of $16.25 per share. The dividend equals $0.40625 per depositary share, each representing 1/40th interest in a share of the Series B Preferred Stock. The dividend will be payable on December 1, 2017, to the holders of record at the close of business on November 14, 2017.

This issue can be called on or after 12/1/17. There is a pretty good chance that it could be. It would a good buy close to par as we approach Nov 14, 2017 or below par after Nov 14 if there is no call.

DFS is a very well managed and profitable company.

 

[Texas Proud]

Well.... I am starting to think that the JCP issues are thinking they are going to file BK...

My holding has gone down 10% recently.... I am now down 22% total...

Might have to get out of this one.... but I was hoping to hold for awhile...

I will probably wait until next divi and see what happens... the holiday season might be good to them....

 

[Mulligan]

Well.... I am starting to think that the JCP issues are thinking they are going to file BK...

My holding has gone down 10% recently.... I am now down 22% total...

Might have to get out of this one.... but I was hoping to hold for awhile...

I will probably wait until next divi and see what happens... the holiday season might be good to them....

Texas, This is the all time worst trade in preferreds I have ever made by far...Granted, its only a $500 loss which is nothing as I only bougnt 300 shares...But still, I hear you... I am holding through the holiday season... Credit ratings are not showing bankruptcy as this is a B rated issue, not CCC... But they are spinning their wheels now...I get a spike, and I am out, myself.

 

[Mulligan]

And I'd be buying the crap out of it if it did,

I think its coming quick, Pig. Better dump NEWEN on me at $100 to free up some cash to get those $35 CNTHP shares coming real soon!

 

[pig pile]

I think its coming quick, Pig. Better dump NEWEN on me at $100 to free up some cash to get those $35 CNTHP shares coming real soon!

will do Mulligan-Grid, they are yours for $100!!!!!

......just as you soon as you give the MSEXP back at $100

 

[Mulligan]

will do Mulligan-Grid, they are yours for $100!!!!!

......just as you soon as you give the MSEXP back at $100

Toss in the CTWSP shares at $15 and we got a handshake deal, Pig!

 

[pig pile]

Toss in the CTWSP shares at $15 and we got a handshake deal, Pig!

Heck, my account thinks CTWSP shares grow on trees

of course I won't mention I paid too much for them. yeh I'll throw you a couple bones there too. lol

 

[Texas Proud]

Texas, This is the all time worst trade in preferreds I have ever made by far...Granted, its only a $500 loss which is nothing as I only bougnt 300 shares...But still, I hear you... I am holding through the holiday season... Credit ratings are not showing bankruptcy as this is a B rated issue, not CCC... But they are spinning their wheels now...I get a spike, and I am out, myself.

OUCH!!! Almost 10% down today.... that is a year of divis....

The problem with getting some that are not fenced off... retail is in a funk and everything related to it is dropping...

Even though JCP had a loss this qtr and negative projection, they still are supposed to have a profit this year...

I think I will hold until it does go back up, but will look for a good dump place if I can...

 

[Mulligan]

OUCH!!! Almost 10% down today.... that is a year of divis....

The problem with getting some that are not fenced off... retail is in a funk and everything related to it is dropping...

Even though JCP had a loss this qtr and negative projection, they still are supposed to have a profit this year...

I think I will hold until it does go back up, but will look for a good dump place if I can...

Texas, I sold today after they edged back up...I only had 300 shares... I just wanted out of it... Dumb to buy, not the type I buy...JCP is a sink hole of unfilled promises of a turnaround... They just took year earnings guidance from 40-65 cents to something like 2 cents a share for the year... They have nowhere to go.. Cramer actually said today its possible they wont have the money to pay the preferreds... Highly indebted company in a bad sector and even worse sub sector (department stores). Their best long term chance of survival is go into bankruptcy and reduce the debt.
If I had more shares I dont know if I would have sold...Im just done with this little game.

 

[bobandsherry]

Holding out for holiday season is probably crap shoot. Let's face it, JCP has lost it's draw power. Perhaps they grab inventory while they can to stock for holidays, sell at steeply discounted margins just to bring in foot traffic and then BK and stick to creditors before payments are due.

Saw on financial show today discussion on JCP. Commented that bonds dropping it's a really bad sign for JCP. One analyst had continued to push JCP as turnaround said he's had it, he's been wrong on JCP and he's sold his position today. From drop Texas mentioned it's probably finally hit a level that everyone has lost their appetite for this stock.

Never try to catch a falling knife and get out of the way before it hits bottom.

 

[Mulligan]

Holding out for holiday season is probably crap shoot. Let's face it, JCP has lost it's draw power. Perhaps they grab inventory while they can to stock for holidays, sell at steeply discounted margins just to bring in foot traffic and then BK and stick to creditors before payments are due.

Saw on financial show today discussion on JCP. Commented that bonds dropping it's a really bad sign for JCP. One analyst had continued to push JCP as turnaround said he's had it, he's been wrong on JCP and he's sold his position today. From drop Texas mentioned it's probably finally hit a level that everyone has lost their appetite for this stock.

Never try to catch a falling knife and get out of the way before it hits bottom.

If it ever was an income play, it isnt now...It is just a distressed turnaround cap gain gamble now. I never bought it for income. Thought I could get a little flip after Christmas and make a few bones like before... Didnt happen.. For what tiny amount I had in it, a hold and see may have been better, but I am over it and through..

 

[aja8888]

It's amazing how one guy (Ron Johnson) brought in as CEO of JCP, a decades long business, can kill the franchise in a couple of short years.

Let’s just point this out upfront: By most accounts, Johnson was trying to accomplish the seemingly impossible with a radical reinvention of the JC Penney brand. Many thought that if anyone could do it, it was Johnson, the retail superstar credited for making Target hip and turning the Apple Store into a monster success story. His plans were bold—too bold, virtually everyone now agrees. Correspondingly, he was removed as CEO not because he came up a little short of the goals set for the company. He was ousted because he failed in spectacular fashion.

The 5 Big Mistakes That Led to Ron Johnson’s Ouster at JC Penney | TIME.com

 

[Sunset]

Hey guys, I have a $100 JCP gift card, so I guess I better spend it before Christmas, glad you talked about JCP as otherwise I wouldn't have realized

 

[Mulligan]

Hey guys, I have a $100 JCP gift card, so I guess I better spend it before Christmas, glad you talked about JCP as otherwise I wouldn't have realized

Sears has been on life support for years and stay hasnt went under....yet.... I bet you can hold off and save the gift card for a while if nothing currently appeals to you, Sunset.

 

[Mulligan]

Cleaned out my cash and bought more NSS at $25.16. Have a decent slug now here... Highly suspect this will be called at $25.47 (the interest payment plus par) come Jan. 15. Collect some coin while forcing money in timeout here...Maybe when it is called some selloffs may have occurred. If not I will hold and collect its payment as it goes adjustable at that point.

 

[Freedom56]

Cleaned out my cash and bought more NSS at $25.16. Have a decent slug now here... Highly suspect this will be called at $25.47 (the interest payment plus par) come Jan. 15. Collect some coin while forcing money in timeout here...Maybe when it is called some selloffs may have occurred. If not I will hold and collect its payment as it goes adjustable at that point.

Looking at what is being called these days, AFLAC 5.5% (AFSD), Royal Bank of Canada 5.5% (RY-S), and Goldman Sachs 5.95% (GS-I), you would think that these financial institutions believe that long term interest rates are headed lower. This a tale of two markets - Technology, financials, and industrial stocks doing well and many sectors such as retail, energy services, and pharma getting crushed.

 

[Mulligan]

Looking at what is being called these days, AFLAC 5.5% (AFSD), Royal Bank of Canada 5.5% (RY-S), and Goldman Sachs 5.95% (GS-I), you would think that these financial institutions believe that long term interest rates are headed lower. This a tale of two markets - Technology, financials, and industrial stocks doing well and many sectors such as retail, energy services, and pharma getting crushed.

Did you see on Quantum what Aflac did to call AFSD? They issued a 2.1% yield 30 year issue in YEN to pay off the US debenture. AFLAC has a significant presence in Japan so I suppose they can just keep that debt overseas and at a substantially lower debt cost. I have pretty much played my hand and will just sit and wait for any of mine to be called...Hopefully none of my QDI illiquids though!

 

[Winemaker]

I am the one with a target on my back, I have had 6 issues called the last few months, albeit at a tidy profit. Don't own any Aflac, but had RBofC, RBofS, and GS-I. That's why I bought the AGO, but held it shortly.

 

[Mulligan]

I am the one with a target on my back, I have had 6 issues called the last few months, albeit at a tidy profit. Don't own any Aflac, but had RBofC, RBofS, and GS-I. That's why I bought the AGO, but held it shortly.

You blew it the other day, Winemaker...Could have snagged old illiquid UEPCO at $99 for a 5.5% investment grade yield and prompt payments for 60 years running...And a $110 call price that will never happen. That would have been right up your alley...Several hundred shares went by the board on that one.

 

[Freedom56]

OHI hit my stops today at $33.50 and automatically sold off. I still made a $2.55 gain over the past 4 weeks plus the $0.63 dividend that will be paid May 15. Bloomberg reported that "The Centers for Medicare & Medicaid Services is considering changing Medicare reimbursement policy and cutting payments to providers with exposure to patients who use the system the most". Heathcare REITS are selling off. I'll wait for the dust to settle before getting back in.

I'm glad I was forced out of OHI a while back. OHI is down to $28.50 today. Many REITS have been selling off. Time to make a shopping list for tax loss selling season.

On another note, A rated bonds/notes and higher were yielding less than FDIC insured CDs of a similar duration. That is starting to unwind. These managers should start using their brains for a change.

 

[Mulligan]

I'm glad I was forced out of OHI a while back. OHI is down to $28.50 today. Many REITS have been selling off. Time to make a shopping list for tax loss selling season.

On another note, A rated bonds/notes and higher were yielding less than FDIC insured CDs of a similar duration. That is starting to unwind. These managers should start using their brains for a change.

A rated bonds make preferreds look like they are fairly priced...Connecticut Light and Power recently reopened a 2014 4.3% bond with 2044 maturity at a price of $109! That is sub 4% for 27 years.....

 

[Freedom56]

More insanity from Fidelity today:

Fidelity is pleased to announce this week's New Issue Agency / GSE offerings:

Name Coupon Maturity Rating* Call Protected** Price
FFCB 2.77% 11/06/24 Aaa/AA+ NO 100-00
FHLB 3.10% 11/16/27 Aaa/AA+ NO 100-00
FFCB 3.48% 11/08/32 Aaa/AA+ NO 100-00
FFCB 3.58% 11/06/37 Aaa/AA+ NO 100-00

Just buy CDs instead

 

[brokrken]

Do you guys think CHSCM is too expensive right now? It's around $27.3. I calculate YTC at about 5.1%.