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

[Freedom56]

Im content with you just being able to wave your wand and get me a 25% sell off in water utilities. Get it done for me, and I know where half my money is going! Try to shut them down, Amazon, lol.

This could be a start of a bigger move down. I just don't buy the hype over the past year. The employment numbers (job gains) are no better than they were in 2015 and 2016. The U6 unemployment keeps inching up and the workforce size is not expanding. What I see is more and more vacant commercial real estate. With GE calling all their long dated 4.875% baby bond issues, what does that tell you about long term rates? I still believe this will be a repeat of 2013 for income investors for the first have of the year. Hard to believe but we actually had inflows into PFF and PGX this week. I'm waiting to get back into the preferred stocks and baby bonds that I sold off in December. They are inching their way down to par.

 

[Mulligan]

Glad I sold my INBKL yesterday. Made a quick 40 cents a share profit on GJO selling today. Finished my 1000 shares lot purchase of PFK today. Not as good as my 25.01 but will take the easy money and hide out until April maturity. Bought old flipping friend KYN-F today. Got 1000 today to hide out in.

 

[Mulligan]

This could be a start of a bigger move down. I just don't buy the hype over the past year. The employment numbers (job gains) are no better than they were in 2015 and 2016. The U6 unemployment keeps inching up and the workforce size is not expanding. What I see is more and more vacant commercial real estate. With GE calling all their long dated 4.875% baby bond issues, what does that tell you about long term rates? I still believe this will be a repeat of 2013 for income investors for the first have of the year. Hard to believe but we actually had inflows into PFF and PGX this week. I'm waiting to get back into the preferred stocks and baby bonds that I sold off in December. They are inching there way down to par.

Fear is what makes the deals. I had a great Jan. despite rate drift. Going high and low right now. Very little mid yield issues. The low term dated ones will hold their ground while I wait. My adjustables are holding strong.

 

[Mulligan]

Gee, what a boring day! Im not sure I even lost any money today.

 

[capjak]

Gee, what a boring day! Im not sure I even lost any money today.

Only if you sold, otherwise nobody lost money today.

 

[Mulligan]

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

Only if you sold, otherwise nobody lost money today.

Cap, right or wrong, I am a mark to market type a guy. To steal a famous coaches line....”You are what your record says you are”. [emoji4]
Did lose a penny trading today...Bought 400 shares of ABRN at $28.38 today and its now $28.37. Bought more PFK also today at $25.03. Cant lose there as it matures April 10 and about 18 cents in income left to spit out before maturity.

 

[capjak]

Cap, right or wrong, I am a mark to market type a guy. To steal a famous coaches line....”You are what your record says you are”. [emoji4]

Then I guess I lost today.

But I am starting my third week in Maui so its not all bad.

 

[Mulligan]

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

Then I guess I lost today.

But I am starting my third week in Maui so its not all bad.

Not true, Cap...You get to make your own rules...Mine cant be forced on you! Third week huh? I bet they are going fast....Slow it down and continue to enjoy!

 

[Mulligan]

If one likes to stack nickels and collect some interest on some dead money, consider putting a bid in on PFK between. $25- $25.03. You would be getting A rated S&P debt that matures April 10. An annualized return of 3.73% and a safe place to park money...I got a slug there in Timeout....

 

[brokrken]

Thinking about picking up some more shares of SPLP-A. Looks like it's at $20.40.

 

[Mulligan]

Thinking about picking up some more shares of SPLP-A. Looks like it's at $20.40.

Its entered my mind too,Ken. It would mean having to let go of something and havet found one i want to part with yet.

 

[brokrken]

Couldn't help myself. I put in for 200 at $20.40, so we'll see if someone picks it up.

 

[Winemaker]

Did you see where SPLP made an offer for Babcock & Wilcox back in December? They reported owning 11.8% back in December 15 2017, and made an offer for $6.00/share for the remainder. Didn't see the offer until it was rejected by the B&W board today.

Trying to pick up some PGX and Monmouth today.

 

[brokrken]

Did you see where SPLP made an offer for Babcock & Wilcox back in December? They reported owning 11.8% back in December 15 2017, and made an offer for $6.00/share for the remainder. Didn't see the offer until it was rejected by the B&W board today.

Trying to pick up some PGX and Monmouth today.

I also somehow missed this until today. I wonder how SPLP planned to pay for it. Perhaps with more of SPLP-T type. By the way, only executed on a partial (61 shares) of my additional 200 share order so far.

 

[Mulligan]

I also somehow missed this until today. I wonder how SPLP planned to pay for it. Perhaps with more of SPLP-T type. By the way, only executed on a partial (61 shares) of my additional 200 share order so far.

That seems like their strategy doesnt it....Well we need to keep an eye on this as we know what happens when preferreds get shoved down a common stock holder....That was an easy money trade. The only preferred trade I did was sell some shares to myself in another brokerage account. I was $7k in the hole overnight as the website shut down and phone lines were jammed yesterday. Im all square now. They better not have some one call me over this or they are going to wish someone else made that call.

 

[Mulligan]

Well that was easy money. Bought ASRVP at $26.50 two weeks ago and got all but 106 shares sold today at $28.35. That was an easy $500 profit. Beats picking up aluminum cans in the winter!

 

[Mulligan]

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

Feel like I am missing out on all the fun as preferred land has slept through the stock market swings. NSS spiked tues and wed, but came back down today. NS showed on their website their new projected balance sheet after the MLP restructuring for 2018 and 2019. They clearly had NSS as part of the balance sheet going forward...I have bought more...Its my biggest position for now. Their coverage ratios are fine and debt covenant compliance is fine. Nice to have an issue going from 7.63% in January to 8.45% in April and more to come if Libor rises.
Used ASRVP proceeds and some cash to buy 1000 shares of OSBCP at $10.40

 

[brokrken]

On OSBCP, what's that huge $3.621 dividend that they paid in 2014?

 

[Mulligan]

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

On OSBCP, what's that huge $3.621 dividend that they paid in 2014?

That was compliments of Uncle Sam...They about (they should have) went under during 2008-09 crisis. They had to suspend the payments for a couple years. They totally fleeced the Feds on bailout. They issued Feds $100 par preferreds and got to buy them back for pennies on the dollar. They got totally recapitalized off the process. Bank is doing fine now and actually has acquired a few banks recently. They put a lot of internal controls in to prevent that from occurring again. I have been in and out of this several times over the years.

 

[brokrken]

Ah yeah, guess I should have noticed that 4 year gap in divies. Wonder what you could have bought these for during those years.

 

[Coolius]

That was compliments of Uncle Sam...They about (they should have) went under during 2008-09 crisis. They had to suspend the payments for a couple years. They totally fleeced the Feds on bailout. They issued Feds $100 par preferreds and got to buy them back for pennies on the dollar. They got totally recapitalized off the process. Bank is doing fine now and actually has acquired a few banks recently. They put a lot of internal controls in to prevent that from occurring again. I have been in and out of this several times over the years.

Am I correct in presuming the senior management is now different from that during 2008-2009 ? Or are the rats still aboard the ship?

 

[Mulligan]

Am I correct in presuming the senior management is now different from that during 2008-2009 ? Or are the rats still aboard the ship?

People have left and even newer CEO recently retired. They have compliance officers and such now. Its just a stodgy local suburban Chicago bank. The 08-09 crisis hit them when to they were overexposed to commercial real estate. The housing didnt help either, but businesses failed on them. One quarter they were profitable and the next quarter the Feds had control.
This was an example of why issues like OSBCP arent allowed to be issued anymore or why there are no cumulative bank preferreds issued either. If a bank gets in trouble now they want the shareholders to feel the pain too.
See in this situation the common shareholders got killed and diluted. The OSBCP shareholders who held on came out smelling like a rose with every penny returned to them.

 

[Mulligan]

Ah yeah, guess I should have noticed that 4 year gap in divies. Wonder what you could have bought these for during those years.

Ken, it actually got down to $3-$4 dollars...But ironically the year before it paid the divi, OSBCP actually went to trading over $13 dollars ($3 over par) because investors new the deferral period was nearing an end and they had the money to pay whenever they decided to do it.

 

[Mulligan]

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

A few more high quality steak dinner trades from Friday while golfing...Put 800 shares of PFK up for sale at $25.28 and some idiot actually bought a few hundred. Considering its only worth $25.18-19 in value at its April maturity I will take the bonus bills. Also flipped out the rest of ASRVP. Some people were willing to pay $3 over par for a past call issue...They can have them. Used the proceeds to reenter GWSVP at $26.48. Last held it a couple months ago for about 3 weeks. Bought at $26.50, flipped at $27.20 and collected a monthly divi also for that quick holding period. The 18.8 cent monthly income payment is next week so cost basis is lower.

 

[Coolius]

AILLL buying opportunity

Saw a big drop for AILLL this morning, unfortunately was not around at computer to take advantage of it.

Price is $26.05, back to where it was a couple years ago. I am actually underwater at this price despite having bought most of my holding years ago.


I consider this price to be a good buying opportunity. Have an order in at $26.10, but not optimistic it can be filled.