Morning Commentary: Fortress Biotech on tap; MetLife weaker; Wells Fargo declines

By James McCandless

San Antonio, Jan. 27 – The preferred space continued a run of negativity as the Wells Fargo Hybrid & Preferred Securities Financial index opened down by 0.26%.

Making waves in the primary market, Fortress Biotech, Inc. announced plans to sell more of its $25-par 9.375% series A cumulative redeemable perpetual preferred stock.

Benchmark Co., LLC and ThinkEquity are the joint bookrunners.

Dividends will be payable on March 31, June 30, Sept. 30 and Dec. 31, starting on March 31, 2020.

The preferreds are redeemable on or after Dec. 15, 2022 at par. Prior to that, the preferreds are redeemable within 120 days after a change of control at par.

At the top of secondary activity, MetLife, Inc.’s 4.75% series F non-cumulative preferred stock started the session weaker.

The preferreds (NYSE: METPrF) were down 7 cents to $25.42 on volume of about 205,000 shares.

Elsewhere, in the finance space, Wells Fargo & Co.’s recent 4.75% series Z non-cumulative perpetual class A preferred stock was declining.

The preferreds, trading under the temporary symbol “WFCZL,” were losing 12 cents to $25.10 with about 190,000 shares trading.

Sector peer Capital One Financial Corp.’s 5% series I fixed-rate non-cumulative perpetual preferred stock also opened under pressure.

The preferreds (NYSE: COFPrI) were losing 1 cent to $25.39 on volume of about 68,000 shares.

Real estate investment trust Armour Residential REIT, Inc.’s new 7% series C perpetual cumulative redeemable preferred stock was on the rise, going against the prevailing trend.

The preferreds, trading under the temporary symbol “ARMRP,” were adding 6 cents to $25.06 with about 172,000 shares trading.

Sector peer Pennsylvania Real Estate Investment Trust’s 7.2% series C and 6.875% series D cumulative redeemable perpetual preferreds were both active and diverging.

The series C preferreds (NYSE: PEIPrC) were dropping 10 cents to $16.00 on volume of about 94,000 shares.

The series D preferreds (NYSE: PEIPrD) were improving by 18 cents to $18.63 on volume of about 73,000 shares.

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