RE:RE:RE:RE:RE:what's with the preferreds?AIM Preferreds offer excellent value at this time, but they're not nearly as fast moving in either direction so not attractive to the quick flippers and momentum traders. With all the babble about what is going to happen by the end of the day, etc, the long-term view on the company and its preferred stock gets easily lost.
Mind you, not all preferreds in this company are created equal. IMO, the obvious stand-out is pr.c, which has the highest par-yield and the longest time left until its reset. In fact, it could very well reset at just the best time when, in a few years, the BOC is finally raising interest rates. But ymmv and dyod.
In the meantime, the preferred securities are traidng at less than half par and at less than 2/3 where they were before the AC debacle. While their dividend is not yielding as high as the depressed commons (~14% vs ~32%), the likellihood of the commons' divi being cut is FAR HIGHER than that of the preferreds. The company will do pretty much everything, including cutting its common dividend to ZERO before it touches the preferred dividends. In short, buying the commons for the dividend at this point seems like a crapshoot, whereas the preferred dividend is relatively secure.
For all the reasons of excitement and chaos that have overtaken the narrative on this company, the preferreds are flying under the radar and present a great entry point. They would make a good logner-term hold most likely, for assuming this company can find some kind of alternative business structure or get sold, the preferreds will pay a great yield throughout this figuring-out-process and all the while will appreciate considerably from these low 11s, as the company's plan becomes clearer. I've been buying them along with the commons.