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Morning Commentary: Bank of America, Anworth set to list on NYSE; Vanguard Natural softens
By Stephanie N. Rotondo
Phoenix, Jan. 27 – Preferred stocks continued to trade into higher territory in early Tuesday trading.
“The long bond is up quite a bit. I thought we’d see some selling off,” a trader said. “But I guess not.”
The Wells Fargo Hybrid and Preferred Securities index was up 12 basis points at mid-morning.
Among recently priced deals, Bank of America Corp.’s $1 billion of 6.5% series Y noncumulative preferreds were slated to begin trading on the New York Stock Exchange on Wednesday.
That deal came Jan. 20 via BofA Merrill Lynch. The ticker symbol will be “BACPY.”
A trader quoted that issue at $24.94 bid, $25.04 offered. Another source placed the issue at $25.04, up 9 cents from the previous day’s close.
Anworth Mortgage Asset Corp.’s $7.5 million of 7.625% series C cumulative redeemable preferreds – another deal from Jan. 20 – was also expected to hit the NYSE on Wednesday.
The ticker symbol will be “ANHPC.”
A trader saw that issue quoted wide at $23.85 bid, $24.55 offered.
MLV & Co. LLC and JMP Securities Inc. were the joint bookrunning managers.
In the secondary market, Vanguard Natural Resources LLC’s preferred units were all slipping early in the session, despite a Seeking Alpha article that said dividends on those issues would likely not be cut.
Last week, the company announced a dividend on its common stock but indicated that the payout could be dropped as the company looks to deal with declining oil prices.
However, the company also said that it did not expect to cut its preferred distribution.
A trader opined that if the common dividend was cut, it could push the preferreds higher.
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