Midday Commentary: Entergy Arkansas 'doing well'; Seaspan yet to free; deals hit NYSE

By Stephanie N. Rotondo

Phoenix, Dec. 10 - Preferred stock investors were sitting on the sidelines Monday, plagued by concerns about the fiscal cliff and talk of a high-yield bubble.

"People are still trying to figure out what they are going to do," a trader said, referring to Washington lawmakers and their ability to come to terms to avoid the fiscal cliff. Investors were also slow to do much, as they remained uncertain about how any deal might affect dividend taxes and the like.

The trader also noted chatter regarding a "high-yield bubble" was not helping the preferred market.

Of the day's dealings, recent issues continued to see the bulk of the activity.

Entergy Arkansas Inc.'s new $200 million of 4.9% first mortgage bonds due 2052 -a deal that priced Thursday - were "doing well," according to a trader, seeing the issue at $25.20 bid, $25.22 offered.

Seaspan Corp.'s $67.5 million of 7.95% series D cumulative redeemable perpetual preferreds - another deal that came Thursday - had yet to free to trade, the trader said, placing the stock around $24.70.

"It should free up today," he said.

Several recent deals were admitted to the New York Stock Exchange on Monday, including Comcast Corp.'s $250 million of 5% $25-par senior notes due 2061.

The ticker symbol is "CCV." The issue priced Nov. 29.

Paper was trading at $25.38 at midday, versus opening levels of $25.15.

Also listed were Kennedy-Wilson Holdings Inc.'s 7.75% $25-par senior notes due 2042 and Tortoise Energy Infrastructure Corp.'s 4.375% $10-par series B mandatory redeemable preferreds.

Kennedy-Wilson's $50 million issue priced Nov. 21 and listed on the NYSE under the symbol "KWN." The notes were at $24.85 as of midafternoon, compared to opening prices around par.

Tortoise's $80 million offering of the $10-par preferreds came Dec. 3. That issue's ticker is "TYGPB," and the securities were trading at $10.05.

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