Morning Commentary: Pennsylvania REIT adds to calendar; Citigroup, Schwab busy post-earnings

By Stephanie N. Rotondo

Seattle, Jan. 18 – The preferred stock primary market added a new deal on Wednesday, a $75 million offering of series C cumulative redeemable preferreds from Pennsylvania Real Estate Investment Trust.

Price talk on the non-rated deal is in the 7.375% area, according to a market source.

A trader said he saw the issue at $24.80 bid in the early gray market.

Wells Fargo Securities LLC, Citigroup Global Markets Inc., Jefferies, J.P. Morgan Securities LLC and Stifel Nicolaus & Co. Inc. are running the books.

Part of the proceeds from the deal could be used to redeem some or all of the 8.25% series A cumulative redeemable preferreds (NYSE: PEIPrA). In response to that, the series As were up 13 cents at $25.43.

In the secondary market, Citigroup Inc.’s 7.875% fixed-to-floating rate trust preferreds (NYSE: CPrN) were on the active side after the bank reported its quarterly results.

Citigroup’s profit of $1.14 per share beat expectations, though revenue of $17.01 billion missed forecasts.

The preferreds were steady at $26.00 at mid-morning.

Charles Schwab Corp.’s 5.95% series D noncumulative perpetual preferreds (NYSE: SCHWPrD) were also busy on earnings, rising 3 cents to $25.56.

Like Citigroup, profit was in line with expectations, but revenue was not.

Charles Schwab reported EPS of 36 cents on revenue of $1.97 billion. For its part, revenue was up 17% year over year.

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