Priority Income prices preferreds; American Homes negative; Bank of America weaker

By James McCandless

San Antonio, Oct. 3 – The preferred space saw top traders trend in both directions Thursday, maintaining the non-cohesive trend that marked early activity.

The primary space saw Priority Income Fund, Inc. price a $25 million offering of $25-par series E term preferred stock due 2024 at par with a dividend of 6.375%.

AerCap Holdings NV priced a $750 million issue of 60-year resettable junior subordinated notes at par to yield 5 7/8%.

At the top of volume, American Homes 4 Rent’s 5.875% series G cumulative redeemable perpetual preferred shares moved negatively.

Elsewhere in the REIT space, Digital Realty Trust, Inc.’s new 5.2% series L cumulative redeemable preferred stock rose.

Sector peer AGNC Investment Corp.’s recent 6.5% series E fixed-to-floating rate cumulative redeemable preferreds also gained.

Meanwhile, in finance, Bank of America Corp.’s 5% series LL non-cumulative preferred stock closed weaker.

Capital One Financial Corp.’s 5% series I and 6.2% series F fixed-rate non-cumulative perpetual preferreds were both under pressure.

Priority Income’s deal

In the primary market, Priority Income priced a $25 million offering of $25-par series E term preferred stock due 2024 at par with a dividend of 6.375%.

There is a $3.75 million greenshoe.

Ladenburg Thalmann & Co. Inc., BB&T Capital Markets, B. Riley FBR, Inc. and Incapital LLC are the joint bookrunners.

AerCap prices

AerCap priced a $750 million issue of 60-year resettable junior subordinated notes (Ba2/BB+/BB-) at par to yield 5 7/8%.

The notes are non-callable for five years.

The yield printed at the tight end of the 5 7/8% to 6% yield talk. Initial talk was 6 1/8% to 6¼%.

American Homes down

At the top of the volume leaders, real estate investment trust American Homes’ 5.875% series G cumulative redeemable perpetual preferred shares moved in a negative direction.

The preferreds (NYSE: AMHPrG) were down 19 cents to close at $26.40 on volume of about 784,000 shares.

Elsewhere in the REIT space, Digital Realty’s new 5.2% series L cumulative redeemable preferred stock was seen rising.

The preferreds, trading under the temporary symbol “DLRTP,” were gaining 7 cents to close at $25.10 with about 555,000 shares trading.

On Wednesday, its first trading day, the preferreds closed above par.

Sector peer AGNC’s recent 6.5% series E fixed-to-floating rate cumulative redeemable preferreds also spent Thursday gaining.

The preferreds, trading under the temporary symbol “AGNIP,” improved by 10 cents to close at $25.14 on volume of about 369,000 shares.

On Wednesday, the preferreds lost 1 cent.

Bank of America weaker

Meanwhile, in the finance space, Bank of America’s 5% series LL non-cumulative preferred stock closed weaker.

The preferreds (NYSE: BACPrN) fell 3 cents to close at $25.63 with about 685,000 shares trading.

On Wednesday, the preferreds picked up 6 cents.

Capital One’s 5% series I and 6.2% series F fixed-rate non-cumulative perpetual preferreds were both under pressure by the close.

The series I preferreds (NYSE: COFPrI) dipped 4 cents to close at $24.82 on volume of about 536,000 shares.

The series F preferreds (NYSE: COFPrF) gave back 1 cent to close at $25.95 on volume of about 408,000 shares.

Indexes up

The Wells Fargo Hybrid & Preferred Securities Financial index ended the day up by 0.09%, adding modestly to the 0.07% rise in early Thursday trading.

The iShares US Preferred Stock ETF was up 6 cents to $37.23.

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