Morgan Stanley taps market; American Equity improves; Energy Transfer negative

By James McCandless

San Antonio, Nov. 18 – The preferred market opened the week on a downward trend, although the most active traders saw mixed activity.

The primary market saw Morgan Stanley price a $500 million offering of $25-par series L non-cumulative preferred stock at par with a dividend of 4.875%.

In secondary trading, American Equity Investment Life Holding Co.’s new 5.95% series A fixed-rate reset non-cumulative preferred stock improved.

Meanwhile, in finance, JPMorgan Chase & Co.’s 4.75% series GG non-cumulative perpetual preferreds moved up.

Sector peer Synchrony Financial’s recent 5.625% series A non-cumulative perpetual preferred stock also gained.

Capital One Financial Corp.’s 5% series I fixed-rate non-cumulative perpetual preferreds were under pressure.

Elsewhere, in oil and gas, Energy Transfer Operating, LP’s 7.6% series E fixed-to-floating rate cumulative redeemable perpetual preferred units slid.

Morgan Stanley prices

The Monday primary market saw Morgan Stanley price a $500 million offering of $25-par series L non-cumulative preferred stock at par with a dividend of 4.875%.

There is no greenshoe.

The deal was announced Monday morning.

Morgan Stanley & Co. LLC is the bookrunner.

Dividends will be payable on Jan. 15, April 15, July 15 and Oct. 15 of each year, starting on Jan. 15, 2020.

The preferreds are redeemable on or after Jan. 15, 2025. Prior to that, the preferreds are redeemable within 90 days after a regulatory capital treatment event.

American Equity up

In secondary trading, annuities name American Equity’s new 5.95% series A fixed-rate reset non-cumulative preferred stock improved by the close.

The preferreds, trading under the temporary symbol “AQYVL,” were up 4 cents to close at $25.54 on volume of about 1.1 million shares.

On its first day of trading on Friday, the preferreds ended above par.

JPMorgan better

Meanwhile, in the finance space, JPMorgan’s 4.75% series GG non-cumulative perpetual preferreds also moved up.

The preferreds (NYSE: JPMPrJ) picked up 6 cents to close at $25.03 with about 804,000 shares trading.

On Friday, the preferreds declined by 3 cents.

Sector peer Synchrony Financial’s recent 5.625% series A non-cumulative perpetual preferred stock was seen gaining.

The preferreds, trading under the temporary symbol “SNFI,” rose 6 cents to close at $25.16 on volume of about 593,000 shares.

Capital One’s 5% series I fixed-rate non-cumulative perpetual preferreds were under pressure throughout the day.

The preferreds (NYSE: COFPrI) shaved off 10 cents to close at $24.80 with about 554,000 shares trading.

Energy Transfer slides

Elsewhere, in oil and gas, Energy Transfer’s 7.6% series E fixed-to-floating rate cumulative redeemable perpetual preferred units slid lower.

The preferreds (NYSE: ETPPrE) dipped 10 cents to close at $24.71 on volume of about 290,000 shares.

Indexes down

The Wells Fargo Hybrid & Preferred Securities Financial index closed down by 0.23%, losing a 0.03% gain from early Monday trading.

The iShares US Preferred Stock ETF was down 6 cents to $37.26.

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