SPMA: An 8.00% Term Preferred IPO From Sound Point Meridian Capital

(14min)

Summary

  • Sound Point Meridian Capital Inc's 8% Series A Term Preferred Shares, SPMA, offer an attractive yield, trading at $24.90 with a Yield to Maturity of 8.35%.
  • SPMA's strong capital structure and significant common distributions buffer ensure preferred shareholders' confidence in financial stability and dividend payments.
  • Despite lacking a credit rating, SPMA's underwriter credit spreads align with established CLO Equity sector companies.
  • SPMA's mandatory asset coverage covenants provide additional protection, making it a compelling option for income-focused investors seeking around an 8.5% yield.

Business finance and investment, Analyze economic growth charts for informed business finance decisions and financial decision-making. Stock Market report, Strategy, Data Collection, Forecasting

Shutthiphong Chandaeng

Co-authored by Relative Value.

Overview

This is another article in which we will examine one of the fixed-income IPOs that took place at the end of 2024. In this short study, we will turn our attention toward Sound Point Meridian

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This article was written by

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Arbitrage Trader, aka Denislav Iliev has been day trading for 15+ years and leads a team of 40 analysts. They identify mispriced investments in fixed-income and closed-end funds based on simple-to-understand financial logic.

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Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in SPMA over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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