Preferreds firm going into weekend; Vanguard up as common distribution cut; Breitburn dips

By Stephanie N. Rotondo

Seattle, Dec. 18 – Preferred stocks were edging higher in Friday trading.

The Wells Fargo Hybrid and Preferred Securities index closed up 9 basis points.

However, a trader said that activity was muted.

“I think everyone must have had holiday parties because nobody is around,” he said.

Vanguard Natural Resources LLC’s 7.625% series B cumulative redeemable preferred units (Nasdaq: VNRBP) were inching up after the company announced it had reduced the distribution on its common units, while maintaining the preferred units.

“The preferreds should jump because they are conserving cash,” a trader said.

The units ended the day up 85 cents, or 11.29%, at $8.38. The units had been up $1.33, or 17.66%, at $8.86, earlier in the day.

In fact, the company said that in lowering the common distribution, it would save nearly $140 million a year. Those funds will then be used to pay down debt.

Elsewhere in the oil and gas space, the tone wasn’t as good, as an increase in active U.S. oil rigs sent crude oil prices downward yet again.

Domestic crude dropped 31 cents on the day, closing at $34.64 a barrel.

For Breitburn Energy Partners LP’s 8.25% series A cumulative redeemable perpetual preferred units (Nasdaq: BBEPP), that resulted in a decline of 26 cents, or 5.07%, to $4.87.

© 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.