Oh I get it. Does it take a lot of digging to determine a ute's business model? Would I have to read an entire prospectus to figure this kind of thing out or is there a quick and dirty way of determining if a ute is T&D only?
No the prospectus for most is dated. For example CNLPL's prospectus was from 1968. It may be only written on a stone tablet. I have quit reading the prospectus's except for the first few paragraphs. They are worded in such a way for legal purposes you would be convinced the company will become bankrupt in a week and accidentally blow up the entire planet.
I go to the company's website and look under investor relations section, articles and SEC filings under the stock in Marketwatch website.
Occasionally you will find some articles on them if you dig deep into the bowels of the web. There just isn't much coverage because they are delisted and really for small players, especially the smaller issued ones. Many are just 10-15 million dollar issues despite coming from a multi billion common equity company.
I set my criteria as over 6%, cumulative dividend, T&D only. There just are not that many in the universe of electrical preferreds that meet that criteria. SO (Southern Co) has a few but they are in the 5% plus range. SCE has some but they are down there also and some are not cummulative. I do have a small amount of EMQ and it yields about 5.8% and the issue is backed by all the plant assets plus is insured from 3rd party for payment so its darn near as safe as a CD.
For me really only BGE-B, CNLPL, CNTHP, and AILLL fit that criteria. If you go under the parent company's ticker in Quantum you will see other issues with different yields. Although they are all sister issues and have the same protections the ones like CNLPL will pay more because they were issued at higher rates thus more risk of a call since all are past call.
In CNLPL's case the ask price was $52.25 this morning. Call price is $51.84. But September dividend of .81 cents has already been declared. So even if they did call it on payment date you still would be 40 cents to the good so not any risk.
We have been in extra low rate environment for years. If they were gonna call it, one would think it would have happened by now. The issues are so small its not worth the cost to call them and reissue. Plus they get to bake the cost of dividends into their rates so in effect they get much of it back anyways.
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