Morning Commentary: Latest quarterly results help National General, hurt Resource Capital

By Stephanie N. Rotondo

Seattle, Nov. 4 – Recent earnings were driving some activity in the preferred stock market, a trader said early Wednesday.

National General Holdings Corp., for instance, had “strong earnings” on Monday, the trader said, which was pushing up the company’s 7.625% $25-par subordinated notes due 2055 (Nasdaq: NGHCZ).

The notes were up 4 cents at mid-morning, trading at $24.75.

The New York-based insurance company reported earnings per share of 43 cents for the most recent quarter. Analysts had expected EPS of 37 cents.

Meanwhile, Resource Capital Corp.’s numbers – which came out after Tuesday’s close – “missed estimates, but they are still making money,” a trader said.

Still, the 8.25% series B cumulative redeemable preferreds (NYSE: RSOPB) were down on the news, falling 28 cents, or 2.83%, to $17.37.

The common stock (NYSE: RSO) was off $1.36, or 10.32%, at $11.82.

For the third quarter, the New York-based specialty finance company reported EPS of 44 cents, which compared to analysts’ expectations of 65 cents. Revenue was $23.71 million, down 8.1% year over year and nearly $17.5 million less than analyst forecasts.

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