Preferreds strong as second quarter begins; new deals on tap; Tsakos greenshoe exercised

By Stephanie N. Rotondo

Seattle, April 3 – The preferred stock market was firm at the start of the second quarter.

The Wells Fargo Hybrid and Preferred Securities index traded up 72 basis points, while the U.S. iShares Preferred Stock ETF was up 68 bps.

“I’d say overall market performance was driven by movement in Treasuries,” one market source said. The 10-year Treasury gained 50 bps and the 30-year added 84 bps.

But while the market had a positive tone, liquidity was weak.

After the market closed, two new deals were added to the calendar. TICC Capital Corp. said it was selling $50 million of $25-par notes due 2024. GWG Holdings Inc. meantime said it was offering $150 million of $1,000-par series 2 redeemable preferred stock.

As for recently priced deals, Tsakos Energy Navigation Ltd.’s $115 million of 9.25% series E fixed-to-floating rate cumulative redeemable preferreds – a deal priced late Wednesday – were seen slipping 3 cents to $24.95, though the weakness in the issue came in the final minutes of trading. Earlier in the session, a trader quoted the paper at $24.90 bid, $24.95 offered, as another source saw the issue rising 11 cents to $25.09.

A market source reported Monday that its $15 million greenshoe had been fully exercised, bringing the total amount outstanding to $115 million.

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