Very good analysis of the financials and a reasonable conclusion trial, however sometimes one must blend in certain non financial bits of data to get to the real truth. This is where the third leg of the stool makes its presence felt, namely "News". According to what I heard, Stockton CA recently went BK. That's it. But it so happens that 1.88% of PTY's portfolio is in Stockton CA bonds. You know what that means right? Stockton defaults, PTY doesn't get paid. NAV goes down. PPS follows. I don't know but I doubt Pimco can even sell the Stockton bonds even if they could find a buyer.
PTY has $28.5 million of bonds issued by Stockton, CA. But it's water revenue bond. Stockton must pay the bond debt with revenues from the water project. I am sure that the people in Stockton still pay for water and the city cannot divert the revenue for other purposes. So the bankruptcy of of Stockton does not have much effects on this bond.