Wow, O preferreds are now trading above $26. I would not be a buyer of the preferreds at this level. Perhaps the price will drop down closer to $25 later in the year.
Over the past several years, O has actually done a nice job of upgrading their tenants. Many used to have weaker credit ratings, but their current tenants are much stronger.
However, they company is probably getting lower cap rates with some of these better tenants.
Normally, the larger firms have partners file conflict of interest statements with their audit clients. I guess somebody forgot to disclose the information !!
Investment grade issues are always nice to have. However, when dividends were suspended on a number of REIT preferreds, many did recover and did not file for bankruptcy.
Felcor suspended their preferred dividend, but then finally repaid this - but I generally don't like the hotel REITs.
REITs do not pay income taxes, so preferred stock may make sense for them. PSA, PSB and NNN are excellent examples. Oh, and Zero too!
Good points David. The added bonus of the article is intellingent investment discussion, as there is no way to predict the future with many securities - but the dividend payments can be locked in when good companies are purchased.
Thanks for letting me know. I really did not have much use for your three ships: The Nina, Pinta and Santa Maria.
What kind of ships do you own - Are they mostly canoes and kayaks? Do you have any rowboats or paddle boats?
Thanks for the response. Yes, many unknown in the sector now. However, products still need to be shipped overseas. I'll continue to look at some of the companies that have low leverage.
Does anyone have any shipping stocks that they could recommend looking in to? I'd prefer a company that has a low debt load. NAT is currently on my Watch List. Safe Bulkers (SB) just issued a new 8% preferred and company makes a fair amount of money.
Comments or thoughts? Thanks.
I have a few of the shares myself in a tax deferred account. Yes, there is some interest rate risk. However, there is inflation risk if people are placing their money in CDs and short term bond funds. I would actually like to see interest rates rise a little, so that I can get 7% yields again on some of the investment grade rated preferreds.