Midday Commentary: Taubman 'kind of weak' post-pricing; Dynex Capital, DDR list on NYSE

By Stephanie N. Rotondo

Phoenix, Aug. 3 - Preferreds were holding up Friday even as a new jobs report indicated that unemployment had ticked up for the month.

The report resulted in "confidence that we'll see QE3 now" come September, a trader said.

Taubman Centers Inc. priced $175 million of 6.5% series J cumulative redeemable perpetual preferred shares on Friday.

The deal was upsized from $75 million and came at the low end of talk.

A trader said the deal was "kind of weak" at $24.68 bid, $24.82 offered, though he added that the underlying common stock was "doing well."

The common stock (NYSE: TCO) was up $1.01, or 1.28%, at $79.61 at midday.

The trader also noted that the size of the deal indicated that the company will likely be able to redeem in full both its series G and H preferreds.

There is a $26.25 million over-allotment option.

Taubman will apply to list the securities on the New York Stock Exchange under the ticker symbol "TCOPJ." Settlement is expected Aug. 14.

Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are the joint bookrunners. PNC Capital Markets LLC is the co-manager.

Dynex, DDR list

Meanwhile, several recent issues listed on the New York Stock Exchange during the day's session.

Dynex Capital Inc.'s 8.5% series A cumulative redeemable preferreds listed under the ticker symbol "DXPA." They were trading up 42 cents, or 1.67%, at $25.67 at midday.

The $50 million issue priced July 25, and the $5.7 million greenshoe was exercised July 31.

DDR Corp.'s $200 million of 6.5% class J cumulative redeemable preferreds also listed. The symbol is "DDRPJ." Paper was up 6 cents at $24.89 in midafternoon trading, though that was down from opening levels of $24.93.

The issue priced July 18.

A trader also remarked that Southern California Edison Co. filed a shelf registration on Friday. The shelf specifically mentions preferreds, leading the trader to speculate that "maybe we'll see another deal from them next week."

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