Preferred stocks mixed; TICC prices upsized ‘baby bond’ offering; AmTrust trends higher

By Stephanie N. Rotondo

Seattle, April 4 – After strengthening on Monday, the preferred stock market was mixed in Tuesday trading.

The Wells Fargo Hybrid and Preferred Securities index rose 14 basis points by the bell, though it was in the red earlier in the day. The U.S. iShares Preferred Stock ETF declined 4 bps. The ETF was down 13 bps at mid-morning.

After the market closed, TICC Capital Corp. priced an upsized $57.5 million of 6.5% $25-par notes due 2024.

The deal came in line with price talk and was upsized from $50 million.

Ladenburg Thalmann & Co. Inc., BB&T Capital Markets, Compass Point and William Blair & Co. ran the books.

Meanwhile, a trader said AmTrust Financial Services Inc.’s preferreds were “snapping back nicely” after the company issued a restatement of earnings for 2014 and 2015.

The preferreds were up 3% to 5% in early dealings.

The company also revised its 2016 results.

The restatements resulted in a 7.2% reduction in net income for 2014 and a downward move of 11.2% in 2015.

Still, the trader noted that AmTrust “doesn’t have that overhang” anymore, thus the preferreds were pushing higher.

GSEs continued to be the dominant securities, however. Fannie Mae and Freddie Mac paper continued to weaken as investors remained concerned about how potential corporate tax changes could negatively impact the agencies.

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