CommonWealth, Endurance issues trade up; Sempra subsidiary preferreds gain on call news

By Stephanie N. Rotondo

Portland, Ore., May 27 - Many preferred stock players got a jumpstart on the holiday weekend, and the increasing number of empty desks resulted in a "very quiet" Friday, according to one trader that stayed behind.

"Volume is very light," said another market source.

CommonWealth REIT and Endurance Specialty Holdings Ltd.'s new issues were seen performing relatively well in the subdued marketplace.

CommonWealth's new $250 million issue of 7.25% series E cumulative redeemable perpetual preferreds traded up to "$24.80-ish," according to a trader.

The deal priced Thursday and was trading around $24.70 in the gray market by day's end.

The trader noted that the shares "are not going to be free to trade" until Tuesday given the long holiday weekend.

Endurance Specialty Holdings' $230 million issue of 7.5% non-cumulative series B perpetual preferreds that came Tuesday were also somewhat better. A trader quoted the preferreds at par bid, $25.15 offered.

In listed securities, Sempra Energy announced Wednesday that its Pacific Enterprises subsidiary will redeem five issues of $100-par preferreds in June. A trader said the paper traded up in response and also remarked that the call was "an interesting sign."

Fellow power-producer Cleco Corp. also announced a redemption earlier in the week, which resulted in a double-digit gain for its 4.5% preferreds.

"The coupons are so low," the trader said. "It's cheap money." That left him wondering what the purpose of the calls was.

© 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.