Morning Commentary: UMH Properties offers cumulative preferred deal; SoCal Edison active

By Stephanie N. Rotondo

Seattle, July 20 – The preferred stock market kicked Thursday’s session off with a new issue announcement.

UMH Properties Inc. said it was selling $100 million of series C cumulative redeemable preferreds, with price talk at 6.75%.

BMO Capital Markets and Stifel Nicolaus & Co. Inc. are leading the deal.

A trader said the paper was trading around $24.75 in the gray market, though he added that there was “not a lot of stock flowing around.”

The Freehold, N.J.-based real estate investment trust intends to use the proceeds from the sale to redeem its 8.25% series A cumulative redeemable preferreds (NYSE: UMHPrA).

Those preferreds were off 86 cents, or 3.28%, at $25.46 in early dealings.

Overall, the preferred stock space continued to have a positive tone to it, though trading volume remained subdued.

The Wells Fargo Hybrid and Preferred Securities index was up 6 basis points at mid-morning. The U.S. iShares Preferred Stock ETF was up 10 bps.

Southern California Edison Co.’s SCE Trust VI-linked 5% cumulative trust preference securities (NYSE: SCEPrL) were the top trader as of mid-morning, with over 106,000 trades. The paper was up 6 cents at $25.31, though on no fresh news to act as a catalyst.

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