Morning Commentary: Preferred stocks strong as second quarter begins; Tsakos breaks through par

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 was up 8 basis points at mid-morning. The U.S. iShares Preferred Stock ETF was up 19 bps.

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

One trader remarked that a fair amount of desks were empty due to vacations. He also noted that it was the start of the quarter and that investors were waiting to see how things kicked the period off.

“I am hearing a couple of new deals this week,” he added, though he was not sure who the issuers would be.

Still, as new issue supply has been lackluster since the start of the year, the deals could be snapped up fairly quickly.

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 quoted at one desk at $24.90 bid, $24.95 offered.

However, another source saw the issue rising 11 cents to $25.09.

The deal – led by Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, UBS Securities LLC, Citigroup Global Markets Inc. and Stifel Nicolaus & Co. Inc. – came upsized to $100 million from $50 million and in line with price talk. A greenshoe later increased the deal to $115 million.

The preferreds are trading under a temporary ticker symbol, “TNPEP.”

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.