Is Vanguard's New 7.88% Preferred Right For You? [View article]
South, I agree. The difference here is that VNR can issue preferreds with relative ease. If possible they could use it as ATM style security where they could access it for additional liquidity.
Is Vanguard's New 7.88% Preferred Right For You? [View article]
Wow, my apologies guys, I should have phrased it better. I didn't mean a dilution would hurt the yield. The difference between this and other preferreds is that the company can issue the same series preferreds. Normally once preferreds are issued, they are locked and the only way the company can issue more preferreds is through another series.
The Market Is Clearly Overvalued Relative To Earnings Growth [View article]
I believe the multiples were relative to each area. For example, the multiple of the S&P 90 was used, but honestly its all relative since 90/90 is the same as 500/500. Hope this makes sense. I believe this chart was weighted properly by S&P.
GE's 5.25% Preferred Is A Good Place To Store Cash [View article]
There is generally interest rate risk for most preferreds given that they are fixed. The same thing applies here. Most of the better quality companies are issuing preferreds with the same terms where they switch to floating in 2023. The only difference here is that you can diversify away from the financials into a conglomerate with a better yield. If you look at stocks right now, the dividend yields on them are lower than this and there is no telling what will happen to the equity values when rates continue to rise. Its a matter of preference. Thanks for reading.
A New 8% Yielder Paying Every Month [View article]
Thanks, and yes I agree this is slightly riskier, but people don't seem to understand this lower cost of capital is being used to pay down higher cost of capital. I also only recommended taking a small position.
A New 8% Yielder Paying Every Month [View article]
I don't quite follow what you mean. Just because the stock is at $1.76 doesn't mean anything. I think you are confused because the offering is not common stock, its preferred stock.
" That is OVER THREE HUNDRED MILLION DOLLARS in stock...."
More on Sears Holdings' (SHLD) Q1 results: Domestic comparable store sales fell 3.6%, comprised of decreases of 4.6% at Kmart and 2.4% at Sears U.S., blamed on weather related declines in lawn and garden; excluding that category, comp store sales would have gained 0.3%. Online business rose 20% Y/Y. Says it may put its service agreement business up for sale to raise cash. Shares -13% AH. [View news story]
We had a warranty on a Sears garage opener. Sears sent multiple repairmen to come and fix it. They brought their own parts. The total cost of the labor and parts were about 4x the cost of a replacement opener. I mentioned to them multiple times that it would be cheaper for Sears just to replace it, but apparently its against their policy. Either way, it costs them a bundle and they didn't seem like they cared.
Grab 60% Over The Next 9 Years On This Preferred [View article]
First let me just clarify that this isn't a preferred, it's straight debt. It's just treated as a preferred. The best way to understand what is best for you is based on your risk appetite. The best example I can give is like this:
Let's say you own an apartment building. The bank lends you money which is senior and you have a legal obligation to pay that mortgage off with interest. The bank knows what it plans to make regardless of how the project performs. Your return will fluctuate based on rent and the market. Nobody really knows what that will be like 10 years from now. At the end of the day, you will be paying the bank off regardless of how your return looks. If your apartment project defaults, then the bank takes over. So it all comes down to how much risk you want.
I personally like this note because 10 years from now, we have no idea what PSEC will look like, I am confident it will still be around, but who knows what there earnings are like. Maybe they cut there dividend. This note will guarantee you your interest payments while protecting your principal due to a forceful maturity. Hope this helps.
Also this article isn't trying to compare PSEC common against the notes, more so it's meant to give investors the ability to purchase a note where they protect their principal, similar to a CD.
Is Vanguard's New 7.88% Preferred Right For You? [View article]
Is Vanguard's New 7.88% Preferred Right For You? [View article]
First PacTrust Bancorp: A Brand New 8% Yield For Your Portfolio [View article]
First PacTrust Bancorp: A Brand New 8% Yield For Your Portfolio [View article]
O Is A Buy, Not A Bargain [View article]
O Is A Buy, Not A Bargain [View article]
The Market Is Clearly Overvalued Relative To Earnings Growth [View article]
GE's 5.25% Preferred Is A Good Place To Store Cash [View article]
Investors Should Laugh At PNC's Preferred [View article]
A New 8% Yielder Paying Every Month [View article]
A New 8% Yielder Paying Every Month [View article]
" That is OVER THREE HUNDRED MILLION DOLLARS in stock...."
You must have read the wrong article.
A New 8% Yielder Paying Every Month [View article]
More on Sears Holdings' (SHLD) Q1 results: Domestic comparable store sales fell 3.6%, comprised of decreases of 4.6% at Kmart and 2.4% at Sears U.S., blamed on weather related declines in lawn and garden; excluding that category, comp store sales would have gained 0.3%. Online business rose 20% Y/Y. Says it may put its service agreement business up for sale to raise cash. Shares -13% AH. [View news story]
A New 8% Preferred For Those With A Moderate Risk Appetite [View article]
Grab 60% Over The Next 9 Years On This Preferred [View article]
Let's say you own an apartment building. The bank lends you money which is senior and you have a legal obligation to pay that mortgage off with interest. The bank knows what it plans to make regardless of how the project performs. Your return will fluctuate based on rent and the market. Nobody really knows what that will be like 10 years from now. At the end of the day, you will be paying the bank off regardless of how your return looks. If your apartment project defaults, then the bank takes over. So it all comes down to how much risk you want.
I personally like this note because 10 years from now, we have no idea what PSEC will look like, I am confident it will still be around, but who knows what there earnings are like. Maybe they cut there dividend. This note will guarantee you your interest payments while protecting your principal due to a forceful maturity. Hope this helps.
Also this article isn't trying to compare PSEC common against the notes, more so it's meant to give investors the ability to purchase a note where they protect their principal, similar to a CD.