Preferred stocks mixed again; Medley gains after add-on prices; GSEs quiet post-earnings

By Stephanie N. Rotondo

Seattle, Feb. 17 – Following in Thursday’s footsteps, preferred stocks were mixed in Friday trading.

The Wells Fargo Hybrid and Preferred Securities index declined 12 basis points, while the U.S. iShares Preferred Stock index ticked up 3 bps.

At Thursday’s close, the Wells Fargo index was the positive one, with iShares trading off.

Medley LLC priced its $30 million add-on to its 7.25% $25-par notes due 2024 (NYSE: MDLQ) late Thursday. The company sold the notes at $25.25 per note, which was in line with revised price talk.

Initial price talk was $25.20 per note.

Come Friday, the paper was seen ticking up 2 cents to $25.18.

“It should pop up here,” a trader opined. “It looks relatively cheap.”

Meanwhile, there was much less trading in GSE-linked preferreds than there has been in the last few months. Fannie Mae and Freddie Mac paper finished the session lower in the wake of Fannie’s latest earnings report.

Though Fannie reported a profit, it warned that a corporate tax rate cut could weigh on its deferred tax asset value, which could lead to a loss that would require more taxpayer funding.

Fannie’s 8.25% series S fixed-to-floating rate noncumulative preferreds (OTCBB: FNMAS) dipped 2 cents to $10.74. Freddie’s 8.375% fixed-to-floating rate noncumulative preferreds (OTCBB: FMCKJ) lost 8 cents, closing at $10.42.

© 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.