Dundee Corporation has changed its stock symbol. The 5% preferred shares formerly known as DBC.PR.A now have the ticker symbol DC.PR.A
The old securityCode was A45100; the new one is A45101. A reorg entry has been processed on HIMIPref™.
Category: Data Changes
BAM.PR.M Disappoints on Opening
The Brookfield new issue closed today and dropped to a closing quotation of $24.59-60 on heavy volume of 395,480 shares.
At this price I like it more than BAM.PR.J – but not by enough (quite!) to perform the swap.
The issue has been added to the HIMIPref™ database with the securityCode A41222, as a reorg out of the pre-issue code, P25003.
It has been added to the PerpetualDiscount Index as of 2006-11-20
A Subdued Opening for CM.PR.I
CM.PR.I, the new issue discussed November 6, commenced trading today and closed at $24.91-92 on volume of 288,892 shares, having traded in the range 24.89-99 throughout the day.
It is a little difficult to understand why the issue did not rise on the first day, as it appears to be attractive by a wide variety of measures, but such is life in the preferred market! Nothing ever works exactly as expected!
In the earlier post, I compared the issue to the roughly comparable CM.PR.H, so I’ll update that comparison now and we’ll see what we see!
| CM.PR.H | CM.PR.I | |
| Changes from the November 6 calculation in brackets | ||
| Base Rate | 24.05 (+0.03) | 23.78 (-0.05) |
| Price due to short-term | 0.08 (-0.01) | 0.09 (-0.01) |
| Price due to long-term | 0.59 (+0.07) | 0.57 (+0.09) |
| Price due to error | 0.02 (Unch) | 0.02 (+0.01) |
| Price due to Credit Spread (Low) | -0.54 (Unch) | -0.53 (-0.04) |
| Intrinsic (subject to rounding error) | 24.20 (+0.09) | 23.93 (Unch) |
| Price due to Liquidity | 1.60 (+0.02) | 1.56 (-0.02) |
| Total (subject to rounding error) | $25.79 (+0.10) | $25.49 (-0.02) |
The CM.PR.H closed at 25.38-50, 10×73, today, so the CM.PR.I has some company in looking cheap!
As one can see, the curve moved against the new issue in the week or so since the last analysis and now “likes” the slightly greater dividend (and hence chance of call) of the CM.PR.H more than it did.
To look at this more closely, we can examine the output from the optionCashFlowEffectAnalysisBox, which I’ll blog about at some future date.
CM.PR.I has been added to the HIMIPref™ database with the securityCode A42018, replacing the “PreIssue” code of P50007.
HIMIPref™ Data Changes : FAL.PR.F, FAL.PR.G, BMO.PR.I
As noted in an earlier post, Falconbridge’s new owners redeemed the issues FAL.PR.F (securityCode A36042) and FAL.PR.G (security code A36043). These entries have now been processed to the HIMIPref™ database, delistingDate 2006-11-02.
A rounding error was discovered in the instrumentDataRecord for BMO.PR.I, which has been recently discussed. The dividendRate had been recorded as $1.188 and has now been corrected to $1.1875.
New Issue : CIBC 4.7% Perp
Well, it didn’t take long for CIBC to replace the capital lost via the redemption of CM.PR.B! They announced a new issue (with a headline announcing a redemption!) that will close on November 15.
Terms of the issue (Class A Series 31) are:
Dividend: Non-cumulative, 4.7% on $25.00 p.v. is $1.1750
Callable:
- $26.00, 2012-1-31 – 2013-1-30
- $25.75, 2013-1-31 – 2014-1-30
- $25.50, 2014-1-31 – 2015-1-30
- $25.25, 2015-1-31 – 2016-1-30
- $25.00, 2016-1-31 +
DBRS: Pfd-1 (low)
S&P: P-1 (low)
There will be 16-million shares outstanding; underwriters have a greenshoe option for an additional 2-million shares. It’s a bought deal.
The terms of this issue make it a reasonably close match to CM.PR.H, issued 2005-3-10, paying $1.20, call schedule commencing 2001-3-30, closing 2006-11-3 at $25.80-89
| CM.PR.H | New Issue | |
| Base Rate | 24.02 | 23.83 |
| Price due to short-term | 0.09 | 0.10 |
| Price due to long-term | 0.52 | 0.48 |
| Price due to error | 0.02 | 0.01 |
| Price due to Credit Spread (Low) | -0.54 | -0.49 |
| Intrinsic | 24.11 | 23.93 |
| Price due to Liquidity | 1.58 | 1.58? |
| Total | $25.69 | $25.51? |
Basically, the thing looks pretty good … priced to move! I’ll also note that it yields 10bp more (at issue) than the recently issued RY.PR.C, in terms of PRE-TAX DIVIDENDS, which is about right considering that the credit spread for “Low” is 11bp AFTER TAX.
This issue has been entered into HIMIPref™ with the temporary security code P50007.
BAM.PR.G Change of Terms
The BAM.PR.G change of terms has been processed on HIMIPref™: the old security code was A41216, the new code is A41219.
RY.PR.C Off to a Fine Start!
The new Royal Bank 4.6% perpetuals were off to a good start today, trading 239,875 shares in a range of 25.15-25 to close at $25.16-18, 3×13.
The reorg entry has been processed on HIMIPref™: the pre-issue code was P50006, the new security code is A45012.
I’ll update this post with some comments about valuation when I update HIMIPref™ with today’s closing quotations later tonight.
Update : The issue still looks attractive at the closing quotation. Consider the YTWs of the other Royal Perpetual issues that are outstanding (except for the soon to be redeemed RY.PR.O:
| Issue | Pre-tax YTW | Quote | “Taxable Curve” Price |
| RY.PR.A | 4.47% | 24.84-91 | 24.97 |
| RY.PR.B | 4.30% | 25.70-75 | 25.83 |
| RY.PR.C | 4.54% | 25.16-18 | 25.59 |
| RY.PR.W | 4.07% | 26.27-55 | 25.89 |
So, it’s my guess there’s still a little value left in this issue!
DBRS Upgrades Canadian Utilities!
DBRS announced today that they are upgrading the Canadian Utilities Limited preferred shares Series O, T, W & X from Pfd-2 to Pfd-2(high), where they will now match the series Q, R, S, U & V.
HIMIPref™ tracks four of these issues:
| CU Issues & HIMIPref™ | ||
| Series | Symbol | Status |
| Q | CU.PR.T | Unchanged |
| R | CU.PR.V | Unchanged |
| W | CU.PR.A | Upgraded |
| X | CU.PR.B | Upgraded |
I do not anticipate much excitement to result from this upgrade. The two issues affected are high-dividend perpetuals with a short period until their YTW call. Due to the shortness of their expected term, NONE of the CU issues are eligible for purchase recommendations from HIMIPref™.
And anyway, as far as I can tell, the market isn’t putting much of a premium on “High” modifiers anyway!
The HIMIPref™ credit rating adjustment will take effect commencing October 31.
BCE.PR.T Added to HIMIPref™ database
What can I say about this issue that I haven’t already said? The issue still hasn’t traded, despite BCE’s eagerness to get some when-issued trading started … but there will be more than 6-million shares out come November 1, so things should pick up a little!
The HIMIPref™ security code for this issue is A39013. It has also been added to prefInfo.
ELF.PR.G Holds its Own!
Somewhat to my surprise, the E-L Financial new issue was able to show some strength on its opening day, closing at 25.15-22 on volume of 135,325 shares.
| Curve Price Analysis of ELF.PR.G | ||
| Component | Taxable Curve | Non-taxable Curve |
| Base-Rate | 23.87 | 23.71 |
| Short-Term | 0.10 | 0.92 |
| Long-Term | 0.54 | 0.02 |
| Credit Spread (2) | -0.52 | -0.68 |
| Credit Spread (Low) | -0.52 | -0.68 |
| Error | 0.06 | 0.08 |
| Intrinsic Price | 23.53 | 23.37 |
| Liquidity | 1.51 | 1.50 |
| Total Curve Price | 25.04 | 24.87 |
This one looks fully priced – and that’s fully priced at best, because there’s a big chunk of liquidity value in the analysis. I suspect that as liquidity goes away, the market value of the shares will decrease, as the market comes to realize that a Pfd-2(low) [DBRS] issue should not be trading a mere 7bp yield higher than, for example, POW.PR.D.
This issue has been added to the HIMIPref™ database with a security code of A43087, replacing the Pre-Issue code of P25002. It has also been added to the PerpetualPremium Index.