AMKBY, BP, CULP, ENB, FAN, FB, FHB, FSPHX, KIO, PAY, PPL, PRPFX, RTL, VNOPRM, WIW

Economy: 

As expected, the FED raised the FF range 25 basis points to .25% to .5%. More tiny increases are expected over the next year or two. Federal Reserve Board - Federal Reserve issues FOMC statement; The Fed got inflation badly wrong --- and now it admits there's no quick fix - MarketWatch 

The FED is now forecasting that PCE inflation will be 4.2% this year, up from 1.9% estimate in March 2021. The Fed - March 16, 2022: FOMC Projections materials Core PCE inflation is projected at 4.1% this year.  

12 out of 16 FED members currently predict that the FF range will be at least 1.75% to 2% by year end. 

Facing Economic Calamity, Putin Talks of Nationalizing Western Businesses. - The New York Times American companies need to realize that Russia is just not worth the trouble. 

Bank of England hikes rates for third time in a row

++++

Markets and Market Commentary: 

Prepare for a recession this summer, a bear market in real estate and a drop in stock prices, warns strategist David Rosenberg - MarketWatch

Oil suffers 'spectacular' collapse, enters bear market just 5 days after settling at nearly 14-year highs - MarketWatch WTI fell 22% over a 5 trading day period after hitting a new 14 year high. 

The S&P 500 Hit a ‘Death Cross ’ Last Monday: Why It's Good News for Investors. | Barron's A death cross is when the 50 day SMA line falls below the 200 day line. The "good news" is that a Death Cross has formed 53 times historically with the average gain thereafter at 6.3% over the next 12 months. An average of 53 times includes cases, as one would expect, of more declines after the Death Cross. One example is a 41.5% decline after a Death Cross in December 2007. A more relevant average than the average from 53 Death Crosses would be one occurring when interest rates are rising with the FED in a tightening mode and inflation moving into problematic territory.  I do not have access to that kind of data. In any event, a brief Death Cross means nothing IMO anyway. We already know that the stock market is struggling this year. 

JPMorgan is winding down its Russia operations amid business exodus

Putin's Ukraine invasion will spur 30-year economic setback: experts Just one of Vlad's gifts to Mother Russia.  

++++

Earnings Reports- Owned Stocks:  

Bank of Nova Scotia (BNS) reports first quarter results (All amounts are in CADs; net income of $2.74B with E.P.S. at $2.14, up from $1.86 in the 2021 first quarter; consensus at $2.04)

Canadian Natural Resources (CNQ) SEC Filed Press Release (all amounts are in CADs; net income = $2.534B or $2.14 per diluted share; daily production at 1,313,000 (BOE/d; adjusted funds flow per share at $3.66)

MetLife (MET) SEC Filed Press Release (Adjusted E.P.S. at $2.17, up from $2.13 in the 2020 4th Q; consensus at $1.47 per Fidelity)

OFS Capital (OFS) SEC Filed Press Release (NII per share of $.33 with the consensus at $.245 per Fidelity; adjusted NII per share  = $.47, which excludes $.14 of accrued capital gains incentive fees; net asset value per share = $15.18, up from $14.16 as of 9/30/21 and $11.85 as of 12/31/20)

Prudential Financial (PRU) SEC Filed Press Release (net income of $1.208B or $3.13 per share, up from $2.03 in the 2021 first quarter; after tax operating income of $1.227B or $3.18 per share with the consensus at $2.36 per Fidelity; 2021 after tax operating E.P.S. at  $14.58)

++++

A substantial majority of Russians still have a favorable opinion of Putin. Vladimir Putin's Approval Rating Gets Boost: Poll (3/13/22)

Putin says pro-Western Russians are 'scum and traitors' who need to be removed from society; Russians spit out 'scum and traitors' like flies, Putin warns West - YouTube Putin says he wants to cleanse Russia society of those who harbor pro-democracy sympathies.  

Russian TV employee who staged bold on-air protest of Ukraine war speaks out: "It was impossible for me to remain silent" - CBS News

Mariupol theater: Russians bomb building where hundreds had taken refuge 

Russian forces are killing civilians and looting stores and home, witnesses in Ukraine say - MarketWatch That is to be expected. 

US officials eye Russian reliance on unsophisticated but brutal heavy weaponry in Ukraine | CNN Politics

‘Pathetic shrieks’: Putin foreign minister Lavrov dismissive of global outrage over Russian attacks on civilians in Ukraine - MarketWatch Lavrov is a pathetic piece of shit just like his boss. 

Russia striking Mariupol maternity hospital is vile but standard operating procedure for Russia-The Washington Post

Kyiv curfew announced after Russia strikes Kyiv’s Sviatoshynskyi, Obolon and Podilskyi residential districts - The Washington Post The Russians are targeting apartment buildings in Kyiv, committing genocide against non-combatants including Russian speaking civilians. 

The U.N. claims that Russia has created over 3 million refugees so far including 55 children per minute. "Particularly shocking" - Every single minute, 55 children have fled their country. A Ukrainian child has become a refugee almost every single second since the start of the war.

Vlad the Impaler claimed yesterday on Putin TV that Ukrainians  were responsible for what is happening since they are resisting Russia's invasion rather than accepting Russia's Führer as their dictator for life. Putin says Russia fighting ‘for the future of our country’ (video included); Putin says Russia's Ukraine operation is a 'success' - France 24 He also made clear that China supports what Russia is doing which I believe is the case.  

4 Falsehoods Russians Are Told About the War - The New York Times

Captured Russian Pilot Says He Was Ordered to Hit Civilian Targets There can be no dispute that Russia is intentionally targeting civilians and civilian structures.  

Mariupol: Pregnant woman and her baby die after hospital bombing - CNN

Russia bombs Mariupol mosque, as troops advance on Kyiv | The Independent

Kyiv strikes: Residents on edge after strikes devastate civilian homes - The Washington Post (3/14/22)

Viktor Zolotov, head of Russia's National Guard, made the following comment about Russia's invasion: “And I want to say that, yes, not everything is going as fast as we would like, but this is just because the Nazis hide behind the backs of civilians, behind the backs of the elderly, women, children, arrange firing positions in kindergartens, schools, residential buildings.”  Zolotov, a former Putin bodyguard, has become rich and not from his salary. Organized Crime and Corruption Reporting Project - OCCRP  

Russia is a fascist, totalitarian state that is best described as a Kleptocracy with Putin being the Führer for life. Putin Isn’t Just an Autocrat. He’s Something Worse. - POLITICO ("there is a word that many historians and political scientists use for an authoritarian state with a charismatic leader who promotes a personality cult. That word is fascism. Mussolini’s Italy and Hitler’s Germany fit the bill, but so does Stalin’s Soviet Union and Kim’s North Korea."); Putin's Kleptocracy: Who Owns Russia?: Dawisha, Karen-Amazon.com: Books

Biden called Putin a War Criminal. Biden calls Putin a "war criminal" in sharpest condemnation since Ukraine invasion - CBS News Of course, Putin is a war criminal but I would not hold my breath waiting for Russia to turn their Führer over for a trial and to provide evidence of his guilt. Führer | Nazi title | Britannica

I watched a video recently of a woman being arrested in Russia for holding a sign with no writing on it. Another was arrested for holding a sign reproducing Bible verses. It is a crime in Russia to speak the truth. These are not signs of strength but an all pervading rot and weakness. 

As Russia Digs In, What’s the Risk of Nuclear War? ‘It’s Not Zero.’ - The New York Times; UN Secretary General: Nuclear War 'Within the Realm of Possibility' After Russian Moves Putin started Russia's invasion with a threat of nuclear war in the event any nation interfered with Russia's conquest. While I never thought the Soviet leaders would resort to a nuclear first strike, it is at least a possibility that Putin will initiate one. Based on the information provided in that article, the trigger for Putin using nuclear weapons is meaningfully less than losing a conventional war involving an invasion of Russia or highly unacceptable casualties from such an invasion. 

Moscow and Kyiv say peace negotiations see progress although difficulties remain - The Washington Post (3/16/22) Russia will need to cease murdering civilians and blowing up civilian structures including single family homes, apartment buildings, commercial buildings, hospitals, etc., as a first step which shows no signs yet of abatement. 

Tucker Carlson Claims Actually, America is Attacking Russia With ‘Disinformation’ (Video) 

Leaked Kremlin Memo to Russian Media: It Is “Essential” to Feature Tucker Carlson 

Rep. Madison Cawthorn (R-NC) calls Zelensky a ‘thug,’ says Ukrainian government is ‘incredibly evil’ - The Washington Post

For the West, the Worst Is Yet to Come - The Atlantic Putin is not a historical oddity but an historically common violent and psychopathic autocrat.

China’s Response to Russia Could Upend the World Order | Time China has allied itself with Russia in their common war on "decadent" democracies. 

Goldman Sachs leaves Russia due to Ukraine invasion

Opinion | Russia, Where All the News Is Fake - The New York Times

Donald Trump was asked about the future of Ukraine. He started talking about windmills | CNN Politics

Forgeard: “What do you see happening next then? ‘Cause it seems like the tensions are high. How does this all end? Is this going to be like a long-term thing? How do you see it unfolding?

Doofus Don: “Well, and I said this a long time ago, if this happens, we are playing right into their hands. Green energy. The windmills. They don’t work. They’re too expensive. They kill all the birds. They ruin your landscapes. And yet the environmentalists love the windmills. And I’ve been preaching this for years. The windmills. And I had them way down. But the windmills are the most expensive energy you can have. And they don’t work. And by the way, they last a period of 10 years and by the time they start rusting and rotting all over the place, nobody ever takes them down. They just go on to the next piece of prairie or land and destroy that.”

Trump Says 'Lot of Love' Behind Putin Wanting to 'Make His Country Larger' (3/13/22)

John Bolton: 'Putin Saw Trump Doing a Lot of His Work for Him' Trump had to be talked out of taking the U.S. out of NATO during his first term but was adamant that he would do so in his second term. Nothing would have pleased Putin more. John Bolton’s crusade to debunk Trump’s revisionist history on Russia and Ukraine - The Washington Post; Allies and Former U.S. Officials Fear Trump Could Seek NATO Exit in a Second Term - The New York Times (9/3/20)

Trump's South Carolina Rally: Election Lies and Another 2024 Tease If Don the Authoritarian runs in 2024, he will win the Republican primary and will receive at least 74+ million votes. 

The Democrats will be blamed for inflation and other matters beyond the control of politicians by enough people that Trump's party will win back control over the Senate and House in 2022 IMO.   

++++

1. Bought 100 WIW at $12.30: 

Quote Western Asset Inflation-Linked Opportunities & Income Fund Overview - A Leveraged Bond CEF

Sponsor's Website: Western Asset Inflation-Linked Opportunities & Income Fund - WIW

WIW SEC Filings 

This fund will mostly own U.S. TIPs, see SEC Filed Annual Report for the fiscal year period ending 11/30/21. 

Page 12

Leveraged: Yes at 32.56% as of 3/9/22

I lack enthusiasm for this CEF given the leverage, my opinion that all U.S. treasuries including TIPs are overpriced IMO, and the rise in borrowing costs likely to occur over the next two years or so. 

The iShares TIPS Bond ETF (TIP) is down this year in its total return. I discuss TIPs in several older posts. Update On Buying TIPs In The Secondary Market | Seeking Alpha (7/21/16 Post); The Mechanics Of Purchasing A TIP In The Secondary Market - South Gent | Seeking Alpha

I do not currently own TIPs. The ones that I owned in Roth IRA accounts have either matured or been sold. I prefer to buy the inflation savings bonds for the reasons previously discussed. One reason is reflected in this table: 

If the yield went to say 2% on a new ten year TIP issue, the only way for the TIP purchased yesterday at a -.61% yield to compensate is to go down in price.   

The advantage is that TIPs do increase in their principal amounts to reflect increases in CPI. 

10-Year Breakeven Inflation Rate-St. Louis Fed

20-year Breakeven Inflation Rate-St. Louis Fed

5-Year Breakeven Inflation Rate-St. Louis Fed

Dividend: Monthly at a variable rate

There have been some special distributions sourced from capital gains. The largest one was $.50 per share paid last December. 

WIW Dividend History | Nasdaq

Next Ex Dividend: 3/23/22 at $.113 which would include a special distribution. 

Data Date of 3/1/22 Trade: 

Closed Net Asset Value per share: $13.78

Closing Market Price: $12.27

Discount: -10.97%

Sourced: WIW  - CEF Connect 

Some Prior Sell Discussions: Item # 2 Sold 301 WIW at $10.97 Update For CEF Basket Strategy As Of 4/13/16 | Seeking Alpha; Item # 5 Sold 301+ WIW at $11.72 (11/6/13 Post); Item # 3 Sold 300 WIW at $13.01-Roth IRA (6/4/2012 Post); Item # 2 Sold 200 WIW at $12.91 (3/15/2012 Post) ; Item # 2 Sold 300 WIW at 12.85 (8/4/2011 Post); Item # 1 Sold 300 WIW at $12.61 (2/1/2011 Post); Item # 4 Sold 300 WIW at 12.43 (12/23/2010 Post); Item # 3 Sold 300 WIW at $12.53 (9/2/2010 Post); Item # 4 Sold 200 of 300 WIW at $12.5 (5/13/2010 Post) 

WIW Trading Profits to Date: Net at + $685.47 

Prior Trade Snapshots: This history reflects a past willingness to take a larger position which is not present now. 

2010 WIW 800 Shares +$266.07

2011 WIW 600 Shares +$215.45

2012 WIW 200 Shares +$40.5

2012 WIW 300 Shares +$63.97 RI

2013 WIW 301+ Shares Net at +$70.61

2015 WIW 202+ Shares Net at -$11.69

2016 WIW 301 Shares +$15.97

2020 WIW 222+ Shares Net at +$25.04

2. Corporate Bonds: 

Starting this week, I am going to consider replacing maturing bonds with new purchases. For the past 18 months or so, I have not even looked for $1K par value corporate bonds to replace maturing ones given the abnormally low yields. 

While the yields are still low, several investment grade corporates do now have higher yields than maturing ones. 

For example, I had 2 National Rural Electric Utilities Finance 2.5% SU bonds mature on 3/15/22. 

Those bonds paid monthly interest. 

I redirected the proceeds into a higher yielding bond as discussed below. 

A. Bought 2 Principal Financial 3.1% SU Bonds Maturing on 11/15/26 at 99.087: 

Issuer: Principal Financial Group Inc. (PFG) 

I own the PFG common shares. 

Last Earnings Report (Q/E 12/31/2021): SEC Filed Press Release (GAAP net income of $498M; non-GAAP net income at $498M)

PFG SEC Filings 

Credit Ratings: Baa1/A-

Fitch at A- Fitch Affirms Principal Financial Group's Ratings; Revises Outlook to Stable from Negative

FINRA Page: Bond Detail

Prospectus (subject to make whole for an early redemption prior to 8/15/26)

Placement in Capital Structure: Senior Unsecured Debt

Total Cost (TC) per bond: 99.187 Includes $1 per bond commission

Current Yield at TC : 3.13%, rounded up 

YTM at TC: 3.289% 

YTM includes the profit when the issuer redeems at par value. 

This kind of investment is only expected to have a higher return than keeping the funds in a broker money market fund until the bond matures. It is more of a return of my money rather than a return on my money type of investment. I am hoping that interest rates continue to rise so that more money can be invested in building an investment grade corporate bond ladder. 

3. Small Ball: 

A. Eliminated BP in All Accounts including Roth IRAs: 

Quotes: 

USDs: BP PLC ADR

Closing Price 3/16/22: $28.61 +$.56 

British Pence: BP PLC (U.K.: London)

ADR Ratio: 1:6 

Convert 1 British Pound to US Dollar - GBP to USD Exchange Rates | Xe

BP Analyst Estimates | MarketWatch

Website: Home

Taxable Account Trades only: 

Sold 6+ at $31.20 

Sold 6+ at $31.37

Sold 15 at $31.31

Profit Snapshots: +$190.44 

+$42.12

+$41 

+$107.32

I discussed this elimination in a comment published on 2/28/22. I sold the BP shares soon after Russia invaded Ukraine due to BP's 19.75% ownership interest in Rosneft. Shortly after my sells, BP announced that it would be disposing of its Rosneft stake at a substantial loss BP offloads its nearly 20% stake in Russia's Rosneft; BP quits Russia after Ukraine invasion | Reuters

BP Is Losing a Third of Its Oil Output. The Rosneft Move Could Lift the Stock. | Barron's The argument is that 

I do not intend to buy back shares unless the price falls below $20. The last break below $20 occurred in 2020, with a bottom hit near $15 in October 2020. There are just too many negative developments.  

Last Discussed: Item # 4.J. Added 5 BP at $23.1- Vanguard Taxable and Item #4.K. Added 1 BP at $23.15- Fidelity Taxable  (7/30/21 Post); Item # 1.F. Bought 2 BP at $24.14 and 8 at $24.85 (4/30/21 Post)

Last Quarterly Dividend: US$.3276

Last 4 Dividends per share: US$1.30, rounded up 

The annual rate was at $2.46 in 2019. 

Last Ex Dividend Date: 2/17/22 (owned as of)

Last Earnings Report (Q/E 12/31/21): BP's fourth quarter and full year 2021 results and update on strategic progress | Investors | Home

Discussed at Oil giant BP reports highest profit in 8 years on soaring commodity prices and BP records highest profit in eight years in 2021 | Nasdaq

Analyst Report (available to Schwab customers):  

Morningstar (3/1/22): 3 stars with a FV of $31

S & P (3/1/22): 4 stars with a 12 month PT of $32, lowered from $37. The analyst tries to look on the bright side of BP's loss on its Rosneft stake. The upside is that Russia's invasion will keep energy prices elevated for some time, which will help BP to offset the $600M in dividends received from Rosneft. The analyst notes that the Rosneft stake was last reported as having a book value of $14B, so the likely hit will be somewhere over $10B. Some media outlets, including Reuters, claimed the loss could be up to $25B. While I do not have details on how that "up to" $25B was calculated, it probably has something to do with the depreciation in the last reported value of the stake based on the publicly traded share price. 

B. Pared FHB in Fidelity Taxable-Sold Highest Cost 11 shares at $29.21: 

Quote: First Hawaiian Inc. (FHB)

FHB Analyst Estimates | MarketWatch

Investment Category: Regional Bank Basket Strategy

FHB SEC Filings

Profit Snapshot: $78.07

Average cost per share this account after pare: $15.73 (32 shares)

Snapshot Intraday on 2/18/22 after pare

I sold every share that had a cost basis of over $20. The AC per share was reduced from $17.36. 

Dividend: Quarterly at $.26 per share ($1.04 annually), last raised from $.24 effective for the 2019 first quarter payment. 

Yield at $15.73 AC per share: 6.61%

Last Ex Dividend: 2/17/22

Last Earnings Report (Q/E 12/31/21): First Hawaiian (FHB) SEC Filed Press Release 

GAAP net income of $57M or $.44 per share; 

GAAP earnings included a $9M charge for repaying early "$200.0 million of Federal Home Loan Bank advances at a weighted average rate of 2.73%"; 

Non-GAAP, referred to as "core" in press release = E.P.S. = $.53, consensus at $.44, but unclear whether the consensus included $9M charge; 

Repurchased $21.5M of stock during the 4th Q; 

NIM = 2.38%, down from 2.71% in the 2020 4th Q; 

Core efficiency ratio  = 53.71%; 

NPA Ratio = .06%; 

Coverage Ratio = 22.1x; 

Charge off Ratio = .19%; 

Core ROA = 1.05%%; 

Core ROE = 10.09%; 

Core ROTE = 16.06%; 

Tangible Book Value per share = $13.03 ; 

Total capital ratio = 13.49%

Sell Discussions: Item # 2.D. Sold 5 FHB in Fidelity Account at $29.86 and Item # 2.E. Pared FHB in Schwab Account-Sold 5 at $29.86 (11/5/21 Post)(profit snapshots = $31.19 and $30.76; the the Schwab account, the AC per share was reduced to $18.25); Item # 3.H. Pared FHB in Fidelity Account- Sold 12.468 at $29.06 (7/9/21 Post); Item # 1.P. Pared FHB in Fidelity Taxable-Sold 5.891 at $30.47  (3/20/21 Post); Item #1.B. Continued Paring FHB in my Fidelity Taxable Account- Sold 5 at $28.61 (3/13/21 Post); Item 1.A. Pared FHB in Schwab Account: Sold 40 at $29.65;  5 at $30.81 and Item #1.B. Pared 10 FHB in Fidelity Account at $29.65 and 10 at $30.02 (2/12/20 Post); Item 1.A. Pared FHB in Schwab Account: Sold 40 at $29.65;  5 at $30.81 and Item #1.B. Pared 10 FHB in Fidelity Account at $29.65 and 10 at $30.02 (2/12/20 Post)

FHB Realized Gains to Date: $502.08

C. Added to CULP-Bought 5 at $8.1: 

Quote: Culp Inc.

CULP Analyst Estimates | MarketWatch

2021 Fiscal Year Annual Report (period ending 5/31/21)

Investment Category: Downgraded to Lottery Ticket Basket from Bond Substitute based on last earnings report. 

The last earnings report, released after this last buy, was unfavorable. 

I am pausing any further buys until I see two consecutive positive reports. 

Buy Discussions: Item # 1.J. Bought 5 CULP at $8.61; 5 at $8.4 (2/17/22 Post); Item # 1.G. Started CULP-Bought 20 at $9.65; 5 at $9.23 (1/27/22 Post)

Average Cost per share: $9.12 (40 shares)

Dividend: Quarterly at $.115 per share

Yield at AC = 5.04%, rounded down. 

Last Earnings Report (Q/E 1/30/22): SEC Filed Press Release 

Net loss of $.02 per share on revenues of $80.291M, down from a $.17 E.P.S. in the year ago quarter. 

For the 9 months ending 1/30/22, E.P.S. was reported at $.23, up from $.14 in the comparable prior period. 

Total cash: $22.21M 

Debt: None 

Depreciation Expense: $1.745M 

Income Tax Expense: Oddly at $1.284M which the company explained as "due to the company’s mix of income between the U.S. and its foreign jurisdictions for the quarter."

D. Bought 10 AMKBY at $15.97: 

Quotes: 

USDs: A.P. Moeller-Maersk A/S ADR

DKKs: MAERSK.B (Denmark)

ADR Ratio: 1 ADR = .005 ordinary

Investor Relations - A.P. Møller - Mærsk A/S

Shipping giants Maersk, MSC and CMA CGM suspend bookings to and from Russia Shipping from Ukraine's  Black Sea ports has also been halted due to Russia's invasion. Those suspensions, which are understandable, will hurt profits this year. 

Last Round-Trip: Item # 2.I. Eliminated AMKBY - Sold 25 at $16.98 (1/7/22 Post)(profit snapshot = $80.14)- Item # 1.B Bought 5 AMKBY at $13.54; 5 at $12.88  (11/11/21 Post) 

2022 Dividend for 2021: Annual; DKK 2,500 per ordinary share payable in 2022, up from DKK 300 in the prior year.  

Maersk Lifts Dividend and Sees Strong First Half -- Update - MarketWatch

The USD equivalent is $1.923 per ADR share, up from $.2611. A. P. Moller Maersk A/S ADR (AMKBY) Dividends -  Morningstar

The ADR dividend will fluctuate with earnings and, to a far lesser extend, the DKK/USD conversion rate.  

Ex Dividend: 3/16/22 (owned as of) 

Yield at $1.923 = 12.04% for 2022 only

Last Earnings Report (Q/E 12/31/21): PDF The company reports in USDs. 

Profit at $6.094B for the quarter and $18.17B for 2021

Earnings per ordinary diluted share = $323 for the quarter and $938 for 2021

Earnings per ADR share = $1.615 for the quarter and $4.69 for 2021

TTM P/E at $4.69 and $15.97 price = 3.4

4th Quarter Cash flow from operating activities = $414M

Discussed at Maersk Posts Record Profits, Sees Supply Chain Woes Persisting | Barron's 

E. Added 5 RTL at $7.14: 

Quote: Necessity Retail REIT Inc. 

52 Week Price Range: $6.83 to $10.69

Investment Category: Equity REIT Common and Preferred Stock Basket Strategy

Management: External

RTL recently changed its name and symbol. The prior name was American Finance Trust that traded under the AFIN symbol. 

I am not paying much attention to the 2021 4th quarter and 2022 first quarter financial reports given the substantial recent acquisitions and dispositions that are discussed in these press releases and a SEC filed investor presentation: 

Investor Presentation at pages 2-4; 

THE NECESSITY RETAIL REIT CLOSES ON 10 PROPERTY, $220 MILLION TRANCHE OF PREVIOUSLY ANNOUNCED $1.3 BILLION OPEN-AIR SHOPPING CENTER ACQUISITION (2/28/22)

AMERICAN FINANCE TRUST CLOSES ON FIRST TRANCHE OF PREVIOUSLY ANNOUNCED $1.3 BILLION OPEN-AIR SHOPPING CENTER ACQUISITION, CHANGES NAME TO THE NECESSITY RETAIL REIT "WHERE AMERICA SHOPS", TO BEGIN TRADING AS RTL ON NASDAQ (2/14/22);   

AMERICAN FINANCE TRUST COMPLETES PREVIOUSLY ANNOUNCED $261 MILLION SALE OF OFFICE BUILDINGS, REDUCING OFFICE EXPOSURE TO 1% (1/7/22)

RTL claims that those transactions will be accretive to AFFO. The REIT will have as a result far more debt however given the cost of those acquisitions.  

RTL SEC Filings 

Website: Necessity Retail REIT

Last Substantive Buy Discussion: Item # 2.L. Added 30 AFIN at $8.21 (11/5/21 Post)  

Average cost per share this account: $8.21

Dividend: Quarterly at $.2125 ($.85 annually).

The last earnings report raised may have raised concerns that this REIT will cut its dividend but it is too early to form an opinion. The REIT was paying a $.091667 per share monthly dividend that was sliced to $.070833 effective for the April 2020 payment. The REIT transitioned to a quarterly payment of $.2125 effective for the 2021 first quarter payment which is no change from the then existing monthly payment. 

Dividend History | The Necessity Retail REIT, Inc.

Yield at AC = 10.35%, rounded down

Last Ex Dividend: 1/12/22

Last Earnings Report (Q/E 12/31/21): The Necessity Retail REIT Announces Fourth Quarter and Full Year 2021 Results The Stock Jocks reacted negatively to this report. The stock closed at $8.01 on 2/23/22 and at $7.36 the next day in response to this report and continued to drift down thereafter, closing at $6.98 on 3/1/22.  

AFFO reported at $.22 per share, barely covering the quarterly dividend. The consensus estimate was for $.24. 

SEC Filed Earnings Call Transcript (company presentation only)

F. Pared ENB in Fidelity Taxable-Sold 5 at $42.4: 

Quotes: 

USDs: Enbridge Inc. (ENB)

CADs: Enbridge Inc. (Canada: Toronto)

ENB Profile | Reuters

ENB Key Metrics | Reuters

Last Substantive Discussion: Item 1.F. Pared ENB - Sold 3 at $42.18 (2/3/2022 Post) I discussed the third quarter report in that post. 

Profit Snapshot: +$42.81 (2/25/22 sale only)

Average cost prior to pare this account: $30.51 

Average cost after pare this account: $30.03 (35 shares)

Snapshot Intraday on 2/25/22 after pare

Dividend: Quarterly at C$.86 per share (C$3.44 annually), raised from C.$835 effective for the 2022 first quarter payment. 

Dividends and Common Shares - Enbridge Inc.

Yield: The yield before taxes will depend on the CAD/USD conversion rate. 

If I assumed a constant .8 CAD/USD exchange rate, which will not happen, the yield at US$30.03 and an annual dividend of  C$3.44 would be about 9.16%. 

The actual yield will go up or down based on the CAD/USD exchange rate when the dividend is paid. 

For example, if the CAD/USD was at 1 for an entire year, the USD value of the current dividend would be US$3.44, creating a yield of 11.46% at $30.03. 

But, if the CAD/USD conversion was at .7 rather than .8, the yield would fall to 8% without any dividend increase (C$3.44 x. .7  = US$2.408  ÷ US$30.03= 8%) 

Last Ex Dividend: 2/14/22

Last Earnings Report (Q/E 12/31/21): Enbridge (ENB) SEC Filed Press Release 

All amounts are in Canadian dollars; 

GAAP net income of $1.84B or $.9 pers share, adjusted to $.68; 

Distributable cash flow at $2.487B, up from $2.209B in the 2020 4th quarter; 

4th quarter DCF per share at $1.23, up from $1.09 in the 2020 4th quarter;  

"DCF for the year ended December 31, 2021 was $10.0 billion, an increase of $601 million over 2020"; 

2021 DCF per share at $4.96, up from $4.67 in the 2020 4th quarter; 

"The Company reaffirms its 2022 financial guidance, announced in December, which included adjusted EBITDA between $15.0 and $15.6 billion and DCF per share between $5.20 to $5.50."

For dividend coverage, I view the DCF number as the most important one. Pipelines have huge non-cash depreciation expenses. 

Buy Discussions: Item # 1.F. Added to ENB in Vanguard Taxable Account-Bought 5 at $29.51; 5 at $28.95; 5 at $27.4 (10/31/20 Post); Item # 1.C. Added 5 ENB at $30.65-Fidelity Taxable (8/15/20 Post): Item # 1.C. Added 1 ENB at $27.23; 1 at $26.21; 1 at $25.49; 1 at $24.29; 1 at $23.68  (4/18/20 Post)

Sell Discussions: Item # 1.E. Sold Remaining Shares Purchased with Dividends in Fidelity Account at 40.14 (10/15/21 Post)); Item # 1.B. Sold 8 ENB at $42.36 (2/19/20 Post); Item # 3.B. Sold 17 ENB at $40.21 (1/18/20 Post); Item # 1.B. Sold 15 ENB at $37.61-Used Commission Free Trade (2/20/19 Post); Item # 3 Sold 50 ENB at $39.03 (12/21/17 Post); Sold 10 ENB at $40.14 (1/5/18 Post) 

ENB Trading Profits to Date: $346.29

Goal: Any total return in excess of the dividends paid.  

I own ENB in several accounts and have not yet pared the low cost positions in two other taxable accounts. 

G. Eliminated PPL in Vanguard Taxable-Sold 13 at $26.85: 

Quote: PPL Corp.

PPL Corp. Analyst Estimates

PPL Investor Relations

2021 Annual Report 

PPL SEC Filings 

PPL is a holding company: 

Profit Snapshot:  +$54.41

This elimination was in response to PPL's quarterly dividend slash from $.415 to $.20 effective for the 2022 first quarter payment and an overall poor first quarter report. PPL Corporation Common Stock (PPL) Dividend History | Nasdaq

The dividend slash was understandable in that PPL sold its U.K. utility business for net cash proceeds of $10.4B and has not yet completed its purchase of Narragansett Electric Company (NEC) for about $3.8B from National Grid USA. PPL Corporation to sell U.K. utility business to National Grid and acquire National Grid's Rhode Island utility, strategically repositioning PPL as a high-growth, U.S.-focused energy company (3/18/21) The NEC acquisition is expected to close later this month. 

I am expecting a modest dividend hike in the first full quarter after the NEC acquisition closes, but it will be years IMO before the quarterly rate works its way back to $.415. 

I still own shares that are in the red. 

Last Earnings Report (Q/E 12/31/2021): SEC Filed Press Release 

E.P.S. from ongoing operations at $.18, down from $.38 in the 2020 4th quarter.  

Non-GAAP at $.22

Consensus at per Fidelity at $.32.

Last Sell Discussion:  Item # 2.D. Sold 50 PPL at $36.2 (1/2/2020)(profit snapshot = $114.96) 

Last Buy Discussion: Item # 1.G.(3/7/20 Post)  

Last Ex Dividend: 3/9/22

I view PPL as a failed investment and consequently will either attempt to work my way out of the remaining unrealized loss positions or sell the shares at a loss which I am not inclined to do now. 

The one year chart reflects the deservedly negative reaction to the last earnings report and the dividend slash: 

The average cost in my Fidelity account is at $28.82, and I will sell when and if the price goes over $30. 

As of Close on 3/16/22

The purchase prices in that account range from $18.72 to $34.65, all small lots.

H. Added to PAY - Bought 2 at $20.8:

Quote:  Paymentus Holdings

Closing Price 3/16/22: $19.91 +$1.30 

PAY SEC Filings

IPO Prospectus (offered at $21 last May)

Paymentus Holdings Inc Profile-Reuters

10-K for 2021. (PAY is a "leading provider of cloud-based bill payment technology and solutions. We deliver our next-generation product suite through a modern technology stack to more than 1,700 biller business and financial institution clients. Our platform was used by approximately 21 million consumers and businesses in North America in December 2021 to pay their bills, make money movements and engage with our clients.")

Investment Category: Lottery Ticket Basket 

This Lotto has not been working as of late. The main reasons IMO are that the "I HAVE A DREAM" stocks do not react well to market volatility and a significant downtrend in high multiple and higher quality stocks (e.g. FB, ETSY, PYPL).    

Last Sell Discussion: Item # 1.B. Sold 4 PAY at $34.6 and 5 at $35.05  (1/20/22 Post)(profit snapshots $58.04). I discussed the 2021 third quarter report in that post. 

Buy Discussions: Item # 1.E. Added to PAY-Bought 1 at $25.25; 1 at $22.23  (9/24/21 Post); Item # 2.I. Added to PAY-Bought 1 at $31; 1 at $30.5; 1 at $29 (8/5/21 Post); Item # 1.G. Bought 1 PAY at $35; 1 at $34.5; 1 at $33 (7/15/21 Post)

Last Earnings Report (Q/E 12/31/21):  SEC Filed Press Release 

GAAP E.P.S. at $.04

Non-GAAP E.P.S. at $.02, with the consensus at $.01 per Fidelity. 

So I guess that I am grateful that PAY did not lose money in the last quarter. 

The guidance for 2022 revenue growth is between 24% to 26% Y-O-Y, which is down from the actual growth of 31.1% in 2021 over 2020. That guidance created a negative reaction among the Stock Jocks. 

Current position: 10 shares 

My maximum position is 20 shares with each subsequent purchase being in 1 or 2 share lots. Each subsequent purchase must be at the lowest price in the chain. 

I. Added to FB-Bought $50 at $212.8; $50 at $209.7; $50 at $206; $50 at 202; $50 at $198.79: $50 at $192.3; $20 at $188.45: 

Quote: Meta Platforms Inc.

FB SEC Filings

2021 Annual Report

FB Analyst Estimates | MarketWatch

1 year chart as of 3/15/22: 52 week high at $384.33

I have nothing to add to my recent discussion, where I discussed the last earnings report. Item # 1.H. (2/17/22 Post); SEC Filed Press Release 

I am just averaging down in small dollar lots. 

Average cost per share: $215.46  (3+ shares)

Closing Price 3/16/22: $203.63 + $11.60 

Dividend: None and none expected. 

J. Added $100 to PRPFX at $48.37; $100 at $48.52: 

Average Cost per share: $40.66 (227+ shares)

Quote:  PRPFX | Permanent Portfolio Overview 

Sponsor's Website: The Permanent Portfolio Family of Funds

SEC Filings

Last SEC Filed Shareholder Report (6 month period ending 7/31/21)

SEC Filing-Investments as of 10/31/21 

Conservative Allocation with close to 25% of fund assets invested in gold and silver bullion: 

As of 7/31/21

I mentioned these purchases in a comment published on 3/5/22. 

Historical Distributions: Paid Annually

I have been reinvesting the dividends. 

This is a snapshot of the distributions paid in December 2021: 

Realized Gains to Date: $899.10

K. Added to VNOPRM - Bought 5 at $23.19: 

Quote: Vornado Realty Trust 5.25% Cumulative Preferred Series M

Issuer: Vornado Realty Trust (VNO)

VNO SEC Filings

Prospectus

Investment Category: Advantages and Disadvantages of Equity REIT Cumulative Equity Preferred Stocks, a subcategory of Equity REIT Common and Preferred Stock Basket Strategy

Par Value: $25
Dividends: Quarterly, cumulative and non-qualified as a pass through entity

Optional Call: On or after 12/13/2022 at par value plus accrued and unpaid dividends

Stopper Clause: Yes

Last Ex Dividend Date: 3/14/22  (owned as of)

Other Round-Trip: Item # 2.A. Eliminated VNOPRM-Sold 50 at $22.95 (5/23/19 Post)(profit snapshot = $56.69); Item 2.C. Bought 30 VNOPRM at $21.98  (5/21/18 Post),Item # 1.A. Bought 20 VNOPRM at $21.57 (12/5/18 Post)

I still own 10 shares. Item # 3.C. Sold 5 VNOPRM at $24.99-Highest Cost lot bought at $19 (7/18/20 Post)(profit snapshot = $29.94), part of the lots discussed here: Item # 3. Bought 10 VNOPRM at $19; 5 at $16.5; 5 at $14.5 (5/2/20 Post). The average cost for the remaining 10 shares is $15.5, which produces an 8.47% yield at that cost per share number.  

VNOPRM Trading Profits = $158.54

Last Discussed: Item # 3.A. Sold 10 VNOPRM at $25.34 (10/31/2020 Post)(profit snapshot = $72.11) 

L. Bought $50 FSPHX at $27.59: 

Quote: FSPHX | Fidelity Select Health Care Portfolio Overview

Last Discussed: Item # 1.L. Bought $50 FSPHX at $28.03 (2/3/22 Post) 

Expense Ratio: .69%

Sponsor's website: FSPHX - Fidelity Investments

Fidelity® Select Health Care (FSPHX) Performance | Morningstar (currently rated at 4 stars)

M. Added 3 FAN at $17.98: 

Quote: First Trust Global Wind Energy ETF Overview 

Sponsor's Website: First Trust Global Wind Energy ETF (FAN)

Expense Ratio: .60%

I would characterize this ETF as being in a long term bear market that started soon after its IPO in June 2008. A cyclical bull market started in March 2020 after a price collapse to around $11. That opinion does not fan the flames of enthusiasm. 

The average annual total return is at -1.02%  since inception through February 2022.  

While Doofus Don, as noted above, is critical of wind energy, more reliance will be place on wind energy generation in the coming years. The question is whether the companies involved in this sector can produce more dependable earnings growth from this long term secular trend. 

Last Discussed: Item 2.K. Bought 2 FAN at $21.02 (11/18/21 Post)

Holdings with greater than a 1% weighting:  

Of those stocks, I currently own ABB, Duke Energy and Orstead.  I have been trimming DUK and have been buying the other two in tiny lots. 

Average cost per share: $19.51  (10 shares)

Closing Price 3/16/22: $19.64 +$.61 

N. Added to KIO- Bought 5 at $13.71: 

Quote: KKR Income Opportunities Fund Overview

KIO SEC Filings

SEC Filed Annual Report for the F/Y Ending 10/31/21

Sponsor's Website: KIO | KKR Funds This CEF owns junk rated securities. 

Leveraged: Yes at close to 37%. 

Investment Category: Monthly Income Generation

Last Discussed: Item # 2.B. Added 5 KIO at $15.22; 5 at $15.06 (3/3/22 Post) 

Average cost per share: $14.95 (30 shares)

Closing Price 3/16/22: $14.04 +$.25 

Dividend: Monthly at $.105 ($1.26 annually)

Yield at AC = 8.42%, rounded down. 

Last Ex Dividend: 3/10/22

Data as of 3/14/22 Purchase: 

Closing Net Asset Value per share = $15.45

Closing Market Price: $13.69

Discount: -11.39%

Sourced: KIO - CEF Connect

Purchase Restriction: Given the elevated risks associated with the really junky securities owned by this CEF, my maximum position will be 50 shares and each subsequent purchase will be no more than 5 shares. Each subsequent purchase will have to be at the lowest price in the chain.   

The net asset value was at $16.13 on 2/15/22, with the share price closing that day at $15.11. The discount to NAV per share was then at -6.32%. 

Since 2/15/22, shareholders have suffered the infamous Double Whammy, defined generally as a significant percentage increase in the discount coupled with a significant decline in NAV per share.  

The yields on junk securities become less attractive as treasury yields rise. Most of the recent decline NAV per share is probably attributable to interest rate risk issues but that is a guess. 

There is also a danger that the CEF may be forced to sell securities in order to reduce leverage when the prices are down from recent levels. 

I may start to reinvest the dividend when the discount exceeds 15%. 

Disclaimer: I am not a financial advisor, but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sale of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. A failure to perform due diligence only increases what I call "error creep". Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals, and situational risks. I can only make that kind of assessment for myself and my family members.