Morning Commentary: JPMorgan on tap; Chimera under par; Bank of America lower

By James McCandless

San Antonio, Jan. 16 – The Wednesday open in the preferred market saw another new deal as the Wells Fargo Hybrid & Preferred Securities Financial index was down by 0.04%.

JPMorgan Chase & Co. plans to price $25-par series EE non-cumulative preferred stock.

J.P. Morgan Securities LLC is the bookrunner.

Citigroup Global Markets Inc., BofA Merrill Lynch, Morgan Stanley & Co. LLC, RBC Capital Markets, LLC, UBS Securities LLC and Wells Fargo Securities, LLC are the lead managers.

The preferreds are redeemable on or after a certain time.

In the secondary, JPMorgan’s 5.75% series DD non-cumulative preferreds opened the session lower.

The preferreds (NYSE: JPMPrD) were down 16 cents to $24.77 on volume of about 271,000 shares.

The company reported a $1.98 per share profit on Tuesday, falling short of analyst expectations of $2.20.

Meanwhile, real estate investment trust Chimera Investment Corp.’s new $25-par series D fixed-to-floating rate cumulative redeemable preferred stock was trading under par on its first day of activity.

The preferreds, trading under the temporary symbol “CMIMP,” were spotted at $24.62 early in the session with about 985,000 shares trading.

Elsewhere in the finance space, Bank of America Corp.’s 5.875% series HH and 6% series GG non-cumulative preferred shares were both falling at Wednesday’s open.

The series HH preferreds (NYSE: BACPrK) were off by 12 cents to $24.95 on volume of about 110,000 shares.

The series GG preferreds (NYSE: BACPrB) were off by 20 cents to $25.34 on volume of about 80,000 shares.

The negativity comes despite the company reporting Wednesday that it had a Q4 profit of 70 cents per share, a sizable increase from the 20 cents per share profit experienced at the same time last year.

U.S. Bancorp’s 5.5% series K non-cumulative perpetual preferreds were slightly higher at the market open.

The preferreds (NYSE: USBPrP) were up 1 cent to $24.98 with about 61,000 shares trading.

On Wednesday, the company reported a $1.07 per share profit in Q4, narrowly besting estimates of a $1.06 per share profit.

Electric utility NiSource Inc.’s 6.5% series B fixed-rate reset cumulative redeemable perpetual preferred stock was rising.

The preferreds (NYSE: NIPrB) were 8 cents higher to $25.40 on volume of about 55,000 shares trading.

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