Preferreds rise ahead of holiday; Eagle Point lists on NYSE; Vanguard could be upgraded

By Stephanie N. Rotondo

Phoenix, May 22 – The preferred stock market ended the week with a firm tone on Friday.

Initially, a trader said the market was “pretty flat” in early trades, as desks started to empty ahead of the Memorial Day holiday.

The Wells Fargo Hybrid and Preferred Securities index finished up 10 basis points. It was up 3 bps at mid-morning.

The trader noted that the latest consumer-price index reading came in “as expected,” rising 0.3%.

Analysts polled by Bloomberg had forecast a gain of 0.2%.

Among the week’s new issues, a trader saw First Republic Bank’s $100 million issue of 5.7% series F noncumulative perpetual preferreds – a deal priced Tuesday – at $24.90 early in the day.

But the issue ended off a penny at $24.79.

Diana Shipping Inc.’s $55 million of 8.5% $25-par senior unsecured notes due 2020 were meantime pegged at $24.70 bid, $24.77 offered.

That issue came Wednesday and freed to trade on Thursday.

From the previous week’s business, Eagle Point Credit Co. Inc.’s $40 million of 7.75% series A term preferred stock due 2020 listed on the New York Stock Exchange on Friday.

The deal priced May 13. The ticker symbol is “ECCA.”

The preferreds ended at $25.10. Paper was trading at $25.17 at mid-morning, versus opening levels of $24.95. The shares had already traded as high as $25.25 early in the session.

Vanguard mixed

Standard & Poor’s said Friday that it had placed Vanguard Natural Resources LLC on review for a potential upgrade.

The agency said the review was based on the company’s recent acquisition of Eagle Rock Energy Partners LP and LRR Energy LP, which it expected to improve Vanguard’s overall business profile.

Vanguard’s corporate credit rating was affirmed at B+.

The oil producer’s preferreds, however, were mixed in end-of-the-week trading.

The 7.625% series B cumulative redeemable preferred units (Nasdaq: VNRBP) were the more active of the company’s preferreds and closed off a nickel at $22.73. The less active 7.875% series A cumulative redeemable preferred units (Nasdaq: VNRAP), however, were up 32 cents, or 1.32%, at $24.57.

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