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National Retail Properties, Inc. Message Board

  • uhadmeatdividend uhadmeatdividend Sep 30, 2013 11:47 AM Flag

    NNN-PD

    Preferred w/coupon of 6.625%. Baa3 Rating. Call date 2/23/17. Pays $1.656 per annum.
    At today's price of $23 = 7.2% yield. If held to call, $5.80 div + $2 current discount to par = $7.80 total return.
    31% return over 4.5 years = 6.8% annualized.

    NNN-PE is a better return.

    Sentiment: Hold

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    • The call date is a one way street. NNN can choose to call the preferred stock or not. If the stock price is less than $25.00, they would simply buy the stock on the open market--assuming interest rates were low enough. The real question is: Why is NNN selling so cheaply compared to O-PE or VNO-PI and other preferred stocks, which have a yield significantly under 7%. Something is amiss, like NNN is going to skip a payment or two.

      • 2 Replies to willisaloony
      • NNN cannot call until call date but may not callat that time and will continue paying dividends until they call. They will pay your $25 back when called. Usually, these preferreds get closer to par as they get closer to call date (maturity). NNN-PD and NNN-PE are fairly recent issues.
        NNN-PE is a strong buy. These preferreds got beaten up with the taper scare as did NNN.
        GLTA

        Sentiment: Strong Buy

      • It is virtually IMPOSSIBLE for a company to miss a payment or two on its preferred stock dividends. In order to do that it would first have to suspend the 5% dividend on the common shares. Moody's ranks this issue as 'investment grade' . So unless you feel the company is about to file for bankruptcy this payment is safe.

 
NNN
37.46-0.29(-0.77%)Jun 2 4:02 PMEDT