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

[Coolius]

WFC-L appears to be ramping up as it approaches the next ex-div date at the end of August.

The yield is now 5.5%, just a little bit better than the rest of the WFC preferreds out there. No longer a great buy. But the non-callable feature still makes it a better buy, if one is concerned with sustainability of income stream.

If it gets back to the $1,300 range, I'm buying back what I sold at $1,332.
Fortunately, that was only 20% of my holding.

 

[Golden sunsets]

Hi Coolius-the run up in this one makes me want to sell to capture capital gains-but then I think..... NO-I want to keep this divy coming in


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[Mulligan]

I found the steal of the year yesterday... Banks many times issue private placement preferred stocks.. Well I found some from a perpetual cumulative non callable until 2048 par $100 8.48% issued probably around 20 years ago. Some leaked into the "Grey Market" and I found them. Bought me 100 at $90... Very sweet 9.4% yield for the next 30 years. Bank is in strong shape pays common divi and never has missed payment. I guess when they issued these 170,000 shares back in day, they never thought rates would be this low. I got the deal because the issue was never meant to be publicly traded as there was no market ever established for it.. Took 30 minutes on the phone for them to find me some. This one is definitely a vault stuffer...


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[Coolius]

Hi Coolius-the run up in this one makes me want to sell to capture capital gains-but then I think..... NO-I want to keep this divy coming in


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Sunsets, I went through the same rationale, just like you.

And I sold 20% of my holdings - 10% sold at $1,262, and another 10% sold at $1,332.

Of course, in hindsight, wish I'd not done it, but at that time I was thinking it would be doing a back & fill, and I could get them back cheaper. And I was wrong....

Heck, WFC-L is printing a price of $1,368 this morning. Definitely not buying at this price. Maybe with all the doom & gloom being screamed from the financial media, it will come true one day, and we'll see WFC-L go below $1,300 - I hope !

 

[Mulligan]

Coolius joined the party and bought with me... FIISO was the ticker...An absolute steal... This was a private pre IPO preferred sale obviously to insiders in 1998 before the bank Financial Institutions Inc came out with the common shares IPO in 1999 at $14 a share... A helluva buy as these are NEVER found...I assume like me, Coolius, you will be taking a dirt nap still clutching the certificates in hand while 6 feet under?


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[makd]

Very interesting.

Questions:

QuantumOnline says they were issues 2014 not 20 years ago. Is there a better reference?
They issued 3% and 8.75%. How do you know you're getting the 8.75% ones?
You bought at 90 and now trading at 110, you could do a quick flip and make $2K?

 

[Coolius]

Once I go under, it's up to the wife what she wants to do with them.

It's a shootout at the OK Corral, on the right, FIISO shares of Coolius, on the left, with shiny VISA credit cards in her holster, Mrs. C.

Guess who wins? And how quickly ?

RIP, FIISO

 

[Coolius]

Very interesting.

Questions:

QuantumOnline says they were issues 2014 not 20 years ago. Is there a better reference?
They issued 3% and 8.75%. How do you know you're getting the 8.75% ones?
You bought at 90 and now trading at 110, you could do a quick flip and make $2K?

Makd, it's easy to make sure one is dealing with the correct issue, just use the CUSIP as well as the Symbol. And, of course, check the description on the quote before submitting any order.

 

[Mulligan]

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

Quantum has that all butchered and flat out wrong. They are pretty good, but not on this one. The issue was never meant to be publicly traded as no market was ever established for it. Its just a pre IPO private transaction from 20 years ago and somebody had to get rid of some. Stocks with no establish market and market maker go to the Grey Issues which is a total dark horse trading place. Usually just penny stocks and bankruptcy companies there. But a few gems are there such as this one and CTWSO which I own a 1000 shares of that has paid its dividend faithfully since 1956 inception. I dug into SEC filings to get correct info. There is a 3% one somewhere, but I totally disregarded it. Im keeping mine. In todays interest rate environment having a non callable 9.4% yield for me is pure gold for a profitable bank.


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[Mulligan]

Once I go under, it's up to the wife what she wants to do with them.

It's a shootout at the OK Corral, on the right, FIISO shares of Coolius, on the left, with shiny VISA credit cards in her holster, Mrs. C.

Guess who wins? And how quickly ?

RIP, FIISO

You may win the battle Coolius... She may not know how or be able to dump these shares, ha!


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[aja8888]

You may win the battle Coolius... She may not know how or be able to dump these shares, ha!


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If little Coolus's are around, that may be their problem someday.

Man, you guy's are on a roll!

 

[Mulligan]

If little Coolus's are around, that may be their problem someday.



Man, you guy's are on a roll!

I should have bought more, but I dont trust banks and I have never even heard of this bank either... Besides the fear to me is always "BANKruptcy"... It was never termed "UTILITYruptcy" for a reason.
Speaking of them...Getting bold..Just bought back 100 more of BGLEN at $103.01 today...Back over 600 shares... The divi of $1.76 is all but in the bag...Now its time to stare them down and dare them to call it with the divi... I bought 800 on the call scare off a few months ago and even snagged $1.76 on half of those last quarter...Been churning and flipping them frequently past 2 months so even if called I have made it a profitable event..
I would much rather play with fire on a call with a safe higher yielding issue than throw in the towel and load up on 5% ers....


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[Mulligan]

Once I go under, it's up to the wife what she wants to do with them.

It's a shootout at the OK Corral, on the right, FIISO shares of Coolius, on the left, with shiny VISA credit cards in her holster, Mrs. C.

Guess who wins? And how quickly ?

RIP, FIISO

Well the good news is we are starting out on the right foot...In less than 30 days it will go exD and we will pocket $2.12 a share right out of the gate!


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[Coolius]

Well the good news is we are starting out on the right foot...In less than 30 days it will go exD and we will pocket $2.12 a share right out of the gate!


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Where do you get the dividend schedule from? Could not find it on the regular sites I visit, such as Dividend.com & QOL.

 

[Mulligan]

Where do you get the dividend schedule from? Could not find it on the regular sites I visit, such as Dividend.com & QOL.

It hasnt been officially declared, but I look at last year...Almost all companies use corresponding yearly dates on everything...That is why I knew Ameren was going to declare next divi for their preferreds today. Here is Morningstar link..Look at right side of page and you will see when it was declared in August of 2015.
http://quotes.morningstar.com/stock...ewId2=2350532651&viewId3=3751232264&ops=clear


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[Texas Proud]

I should have bought more, but I dont trust banks and I have never even heard of this bank either... Besides the fear to me is always "BANKruptcy"... It was never termed "UTILITYruptcy" for a reason.
Speaking of them...Getting bold..Just bought back 100 more of BGLEN at $103.01 today...Back over 600 shares... The divi of $1.76 is all but in the bag...Now its time to stare them down and dare them to call it with the divi... I bought 800 on the call scare off a few months ago and even snagged $1.76 on half of those last quarter...Been churning and flipping them frequently past 2 months so even if called I have made it a profitable event..
I would much rather play with fire on a call with a safe higher yielding issue than throw in the towel and load up on 5% ers....


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So YOU are the one front running!!!

I have had an order in for 102.75 and it has been sitting at the top for a few days and I have watched a few 103s go by... might have to bite the bullet and raise my bid!!!

 

[Mulligan]

So YOU are the one front running!!!

I have had an order in for 102.75 and it has been sitting at the top for a few days and I have watched a few 103s go by... might have to bite the bullet and raise my bid!!!

Dont feel bad Texas...Some AHole front ran me yesterday.. I saw a $102.75 (so that was yours, sorry). I saw last trade was $102.80 but only 20 shares... So I went a penny above last 100 lot trade...Then somebody front ran me at $103.05, then some bot front ran him the first 200 shares at $103.0501. But he did eventually get his yesterday, and mine finally fell my way this morning... I think there are a few itchy trigger finger sellers fearing a call with the divi...I think it makes no sense to call it 3 months later otherwise it would have been done then. Plus BGLEH could get called on its own as it is a lot bigger and a higher payer too.
Btw- Ameren declared all dividends for all preferred stocks for the following quarter too, today.


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[Texas Proud]

Well, it looks like someone is dumping BGLEN....

I had changed my order to $103 and it hit this morning... but now they are selling at $102.26...

 

[Mulligan]

Well, it looks like someone is dumping BGLEN....

I had changed my order to $103 and it hit this morning... but now they are selling at $102.26...

Bad news Texas....It appears BGE is raising a bond offering to potentially call both preferreds and some other debt... It just came out today...
USE OF PROCEEDS
We anticipate our net proceeds from the sale of the notes will be approximately $ after deducting underwriting discounts and estimated offering expenses. We intend to use the net proceeds we receive from the issuance and sale of the notes to repay $300,000,000 of our 5.90% Series B notes due October 1, 2016, to repay a portion of our outstanding commercial paper obligations and for general corporate purposes. As of August 11, 2016, we had $324 million of outstanding commercial paper obligations, which had remaining maturities of less than 30 days and annual interest rates ranging from 0.65% to 0.80%. We may also use a portion of the net proceeds from the sale of the notes to redeem some of our preference stock, of which there is $90 million aggregate principal amount currently outstanding with annual dividend rates ranging from 6.70% to 6.97%. If we do not use the net proceeds immediately, we may temporarily invest them in short-term, interest-bearing obligations.
RATIO OF EARNINGS TO FIXED CHARGES


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[Texas Proud]

Bad news Texas....It appears BGE is raising a bond offering to potentially call both preferreds and some other debt... It just came out today...
USE OF PROCEEDS
We anticipate our net proceeds from the sale of the notes will be approximately $ after deducting underwriting discounts and estimated offering expenses. We intend to use the net proceeds we receive from the issuance and sale of the notes to repay $300,000,000 of our 5.90% Series B notes due October 1, 2016, to repay a portion of our outstanding commercial paper obligations and for general corporate purposes. As of August 11, 2016, we had $324 million of outstanding commercial paper obligations, which had remaining maturities of less than 30 days and annual interest rates ranging from 0.65% to 0.80%. We may also use a portion of the net proceeds from the sale of the notes to redeem some of our preference stock, of which there is $90 million aggregate principal amount currently outstanding with annual dividend rates ranging from 6.70% to 6.97%. If we do not use the net proceeds immediately, we may temporarily invest them in short-term, interest-bearing obligations.
RATIO OF EARNINGS TO FIXED CHARGES


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Gee... great


At least I got my $200 from selling at $105.... and a divi coming up...

So, if they call right away it looks like I am close to break even... maybe a small loss...

 

[Mulligan]

As Coolius would tell me, calm down the battle isnt over yet!
I sold 400 at $103 today...But I kept 200 for the heck of it. Besides, my thought is stay calm, as they may not announce anything until after divi declaration... Snag it then throw them out to some nit wit and you still may make money yet!!!! BGLEH acted today like nothing happened. Bidder at $103.01 and ask $107... No shares trading....I made some darn good money flipping this bad boy over the past year and its sisters too. A shame to see this little friend had to go...


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[Texas Proud]

As Coolius would tell me, calm down the battle isnt over yet!
I sold 400 at $103 today...But I kept 200 for the heck of it. Besides, my thought is stay calm, as they may not announce anything until after divi declaration... Snag it then throw them out to some nit wit and you still may make money yet!!!! BGLEH acted today like nothing happened. Bidder at $103.01 and ask $107... No shares trading....I made some darn good money flipping this bad boy over the past year and its sisters too. A shame to see this little friend had to go...


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I have been trying to find the ex divi date... do you know when it is?

I must have bought 100 of yours LOL...... but I will not panic yet... but I think that they will call pretty quickly...

How did you get the info on the new issue... it is buried in the SEC filing... and is for the parent, not the issue...

 

[Mulligan]

I was very sporadic on that stuff, but you taught me the lesson to check around exD time for that call stuff with BGLEI, so I learned that lesson.
Its under EXC (Exelon) filings but then you have to go under the Baltimore Gas and Electric sub filings. BGE is is the subsidiary that is issuing the bond offering.
They never declare dividend until late. I suspect official declaration will be in the next 10 days or so. Hopefully they will drag their tails on the call as they have to give 30 days notice. Mayne this will bleed out a while. But we know what happened last time.


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[Texas Proud]

I was very sporadic on that stuff, but you taught me the lesson to check around exD time for that call stuff with BGLEI, so I learned that lesson.
Its under EXC (Exelon) filings but then you have to go under the Baltimore Gas and Electric sub filings. BGE is is the subsidiary that is issuing the bond offering.
They never declare dividend until late. I suspect official declaration will be in the next 10 days or so. Hopefully they will drag their tails on the call as they have to give 30 days notice. Mayne this will bleed out a while. But we know what happened last time.


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I found a site that has history... looks like the 8th of next month....

https://www.dividata.com/stock/BGLEN/dividend

 

[Mulligan]

Here is the link for the prospective offering. Its a supplement of the May issuance so things could move quickly here.
https://www.sec.gov/Archives/edgar/data/9466/000119312516681441/d239869d424b2.htm


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