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Season's Beatings From The High Yield Shipping Preferred Stock Sector

|About: Costamare Inc. (CMRE), GSL, NM, SB, SSW, TNP, TOO
Summary

Panic selling in the high yield shipping preferred stock issues.

What are the best values and what are the value traps?

The trade war, recession fears and tax loss selling appear to have caused panic selling even in cases where the actual shipping rates remain strong.

A quick review of several issues.

Full coverage of all these high yield issue (and more) as the Panick High Yield Report.  Start your 2 week free trail now.

It's hardly been a joyous holiday season for those with investments in the high yield shipping preferred stocks.  Many issues have plunged to financial crisis type pricing.  This article provides a quick run down on some of the shipping preferred stock issues that have plunged in price.  A no-risk 2 week free trial to my Panick High Yield Report service is now available for those who want my coverage of these and many more high yield issues that are now on sale.  New subscribers that join prior to 1/5/2019 will also receive a 10% off discount.

Here is a quick run-down of some of the issues that are on now sale:

1. The TOO Preferred stocks

TOO.PA is trading at levels we last saw when there was a real crisis.  That was resolved as the new General partner came in and injected massive amounts of new equity while refinancing near term debt maturities.  It's important to realize that $56 Brent oil is not going to shut down the offshore oil fields that Teekay Offshore Partners LP (TOO) provides shuttle tankers and floating platforms to.  These are provided under long term contracts with credit worthy oil majors.

2. The SB Preferred Stock Issues

Safe Bulkers Inc. (SB) has been busy using positive cash flow to pay down debt and extend debt maturities.  They have not bought a lot of ships or resumed the common dividend.  The BDI remains at a very cash flow positive rate for this low cost operator.  There is even extra cash for some share buybacks and yet the SB.PB and SB.PC preferred shares are trading at firesale prices.

3. The TNP Preferred Shares

Tsakos Energy Navigation Ltd (TNP) had a very tough quarter, but listen to the Q3 earnings conference call.  Tanker rates have sky-rocketed so far in Q4.  I know you would never guess this by looking at trading.  Low oil prices help TNP by increasing demand for oil.  Unless we get a major recession, we are unlikely to have both very low oil prices and lower demand to ship oil.  I cover the "failure to redeem" TNP.PB and TNP.PC issues. These upcoming redemptions are hardly in doubt given the strong liquidity at TNP and recent rate improvements.  For those willing to take a little more risk, TNP.PD, TNP.PE and TNP.PF are also great choices.  One of them even has a nice fixed to floating rate feature.

4. The Global Shipping Preferred

GSL.PB is on sale, but there are plenty of higher quality issues on sale.  Global Ship Lease Inc. (GSL) is seeking consent from it's bondholders to resume a common stock dividend in 2020, but there is skepticism (see the price action in the GSL common stock) about their ability to do so.

5. The CMRE Preferred Stock Issues

CMRE.PD and the others are on sale.  Costamare Inc. (CMRE) has been reducing balance sheet leverage.  They are profitable with strong cash flow, a good balance sheet and lots of long term shipping leases.  They are in good shape to survive a trade war or recession.

6. The SSW Preferred Stock Issues

Over the last year Seaspan Corporation (SSW) sold massive amounts of equity and refinanced debt to clean up their balance sheet.  They have a focus on long term contracts and plenty of access to capital if they need it.  Yet SSW.PH and the other preferred stocks are still on sale.  Also some nice baby bond issues.

7. The NM Preferred Stock Issues

The deferred NM.PG and NM.PH issues are now very cheap and super high risk.  I do follow them and perhaps Navios Maritime Holdings Inc. (NM) will rebound making them a good speculation at some point.  

In fairness, to my paid Panick High Yield Report members that's about all I can say here.  Several more high yield shipping preferred stock and bond issues are on sale that I have not even mentioned.  Some are bargains and some may not be such great bargains.  That's just for the shipping sectors.  Plenty of high yield bargains are popping up now in many sectors.  As you can imagine, things are very busy at the Panick Report.

For more information, there could not be a better time to try out our 2 week free trial.  Take advantage of the best sales on so many high yield issues. If you do decide to subscribe after the no-risk 2 week free trial ends there is even a 10% off sale on our service now in effect.  To get the discounted price, just be sure to start your 2 week free trail by 1/5/2019  Our outstanding member reviews (includes all reviews as collected by Seeking Alpha) can be read here.  The Panick Report is especially known for our active and friendly member's only chat board.  It's a "must have" service to find the best high yield values in today's volatile and fast moving markets.  Join our 300+ community of investors and traders.

Disclosure: I am/we are long SB.pc, SB.PD.

Additional disclosure: I am also long TNP.PF, TOO.PA, TOO.PE,