Midday Commentary: Preferreds remain weak as shortened week begins; Wells Fargo plans new deal

By Stephanie N. Rotondo

Phoenix, Nov. 13 - The preferred stock market was on the softer side Tuesday as market players returned from the long weekend.

However, the market was only "slightly" heavy, a trader said.

"We might see some profit-taking, especially given the run up that preferreds have had," the trader commented.

Last week, a trader reported that he had heard rumors of a new Wells Fargo & Co. preferred deal. On Tuesday, that chatter proved to be true when the San Francisco-based bank said it intended to sell at least $250 million of series O noncumulative perpetual class A preferred shares.

Price talk is 5.125% to 5.25%, according to a trader.

"It seems to be going fine," a trader said of the new issue's dealings in the gray market. He saw trades around $24.60 as of midday.

Wells Fargo Securities LLC is the bookrunner. Joint lead managers are Bank of America Merrill Lynch, Citigroup Global Markets Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and UBS Securities LLC.

Proceeds will be used for general corporate purposes.

© 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.