Morning Commentary: Preferreds continue to firm; new Goldman deal heads higher; Freddie on the rise

By Stephanie N. Rotondo

Seattle, Feb. 18 – The preferred stock market was again “bouncing back,” a trader said Thursday.

The Wells Fargo Hybrid and Preferred Securities index, however, was only marginally stronger, rising 1 basis point at mid-morning.

But Goldman Sachs Group Inc.’s $675 million of 6.3% series N noncumulative perpetual preferreds – a deal priced Tuesday – were moving up nicely, as a trader quoted the paper at $25.15 bid, $25.17 offered.

That compared to Wednesday’s closing levels just north of par.

The deal freed to trade on Wednesday and is already trading with a temporary ticker symbol, “GSHSP.”

Meanwhile, Freddie Mac reported earnings early in the session, showing a larger profit than year-ago comparables.

On the news, the GSE’s 8.375% fixed-to-floating rate noncumulative perpetual preferred stock (OTCBB: FMCKJ) were heading higher, trading up 8.21 cents, or 2.83%, to $2.9821.

Over 1.4 million shares had been traded as of mid-morning.

Peer Fannie Mae also saw its preferreds rising, with the 8.25% series S fixed-to-floating rate noncumulative preferreds (OTCBB: FNMAS) gaining 2 cents to $2.93.

For the quarter, Freddie reported a profit of $2.16 billion, which compared to a profit of $227 million the year before.

Freddie plans to make pay $1.7 billion of said profits to the Treasury, bringing the total given back to taxpayers to over $98 billion. The agency received over $71 billion in bailout funding in 2008.

© 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.