Morning Commentary: Primary pipeline stemmed ahead of bank earnings kick-off; American Homes up

By Stephanie N. Rotondo

Seattle, July 13 – With bank earnings just one day away, the preferred stock market was slowing back down early Thursday.

No new issues were announced, though the pipeline had been steady all week.

Additionally, the market had a mixed tone in early dealings, even though the space had closed in positive territory the day before.

The Wells Fargo Hybrid and Preferred Securities index was up 2 basis points, about in line with the broader markets. For its part, equities were better for the second day in row as Janet Yellen, chairman of the Federal Reserve, gave a dovish report to Congress.

However, the U.S. iShares Preferred Stock ETF was off 9 bps.

Among recent deals, American Homes 4 Rent’s $115 million of 5.875% series G cumulative redeemable preferreds – a deal priced Monday – were rebounding from the midweek low, adding 6 cents to trade at $25.02.

The deal came upsized from $100 million and priced at the tight end of the 5.875% to 6% price talk.

The issue freed to trade on Tuesday and was assigned a temporary ticker, “AMMRP.”

Wells Fargo Securities LLC, BofA Merrill Lynch and Raymond James led the deal.

In the secondary space, Validus Holdings Ltd.’s 5.8% series B noncumulative preference shares (NYSE: VRPrB) were losing ground, though there was no fresh news to act as catalyst.

The shares were down 8 cents at $25.30.

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