BNL, BWG, CVBF, EXG, GOODN, ICMB, MBWM, MDT, NWFL, OLP, PDM, STBA, THFF, TSLX, UL

Economy: 

The government's first estimate of real GDP growth in the first quarter was 1.1%. Gross Domestic Product, First Quarter 2023 (Advance Estimate) | U.S. Bureau of Economic Analysis (BEA) 

Personal consumption expenditures increased at a 3.7% annual rate, up from 1% in the 2022 4th quarter: 

I would not draw any negative conclusions about the economy weakening in the first quarter given the jobs numbers and the first estimate for consumer spending during the quarter. The market rallied strongly after the release, though part of the rise may have been due to META's earnings report. Meta Platforms (META) Q1 Earnings Beat, Revenues Rise Y/Y - April 27, 2023 - Zacks.com 

The main GDP drags were residential investment and some business spending particularly on equipment. 

PCE Price Indexes: The core PCE price remains high and well above the FED's target of 2% annual growth. Total PCE prices declined from a 5.1% annually rate through February to 4.2%. 

Personal Income and Outlays, March 2023 | U.S. Bureau of Economic Analysis (BEA)

As shown in the preceding table, personal consumption expenditures leveled off in February and March after surging in January. 

House GOP narrowly passes bill to raise debt limit and cut spending; White House called it 'ransom' - ABC News

It is only a question of time before the republicans cause a U.S. debt default and permanently impair the U.S. Dollars status as the international reserve currency. Janus Yellen is right when she said that a default will be catastrophic. Yellen Says US Default Would Cause an 'Economic Catastrophe' - YouTube

Fitch has warned that it may downgrade U.S. debt even if the latest Republican extortion attempt results in a debt limit increase. The reason given was the constant brinkmanship, originating solely from republicans, calls into question the government's reliability to pay its bills when due. America's credit rating could get downgraded even if a default is avoided, Fitch Ratings warns S&P downgraded U.S. debt one notch back in 2011 after the republicans came within two days of causing a default. 

It looks like First Republic Bank is about to be seized by the FDIC. This will be the third mid-size bank failure this year caused, not by bad loans, but by deposit runs. FRC closed at $3.51 yesterday, down 43.2% and declined another 33.62% in after hours trading. The FRC 52 week high was at $171.09. Federal officials are preparing to put ailing First Republic Bank into RECEIVERSHIP, sources claim  | Daily Mail Online At least two banks are apparently bidding for the assets once the FDIC seizes the bank. JPMorgan, PNC bidding to by First Republic Bank after FDIC takeover FRC has several equity preferred stocks that will become worthless after a seizure. I have never owned the common or the preferred shares. 

+++

Allocation Shifts Discussed in this Post: 

Treasury Bills: $2,000 in principal amount (I am placing more emphasis on buying FDIC insured CDs until the debt limit issue is resolved)

Corporate Bonds: $6,000 in principal amount

CDs: $16,000

Net Outflow Common Stocks: -$450.26

(consisting of $1,167.54 in proceeds minus $717.29 in purchases)

Outflow Stock CEF:   -$192.02 (25 shares of EXG)

Net Outflow Common Stocks and Stock Funds: -$642.28

Weighted Average Yield Common Stock Purchases: 6.38% (the general approach is to exceed 5% per week). 

Leveraged CEF Bond Fund: +$39.24 (yield at 12.23%, substantial ROC support)

REIT Equity Preferred Stocks: +$360.75 (Yield at 9.18% for 20 shares purchased)

2023 Net Outflow Common Stocks/Stock Funds: -$31,393,09 (outflow is going into MM funds, CDs, corporate bonds and treasury bills)

+++

Trump and His Anti-Democracy Party: 

North Carolina Supreme Court -- under new GOP control -- reverses rulings that struck down partisan gerrymanders by Republican lawmakers The anti-democracy party now controls the republican legislatures and the state Supreme Courts in several states including North Carolina. The general goal for the NC GOP is to win 80%+ of the congressional seats with about 50% of the vote, effectively disenfrancing a few million voters in congressional elections. 

NBC News poll: Nearly 70% of GOP voters stand behind Trump amid indictment, investigations

Donald Trump embraces Jan. 6 defendant who wants Pence executed

Trump ‘raped me’: E. Jean Carroll testifies about alleged attack

Trump Was At A Meeting Where Loyalists Discussed Plans To Break Into Voting Machines - TPM 

Amid Expulsion Vote In House, Tennessee Senate Quietly Names April ‘Confederate History Month’; How conditions went from bad to worse for the Tennessee GOP

Ohio Republican launches Senate campaign by demanding reparations for white people - Alternet.org

When GOP Attorneys General Embraced Jan 6, Corporate Funders Fled. Now They’re Back.

VA warns 81K health care employees’ jobs at risk under House GOP debt ceiling plan | Federal News Network 

The House republican budget proposal, which passed 217-215 with no democrat votes,  would require massive cut in non-defense spending. Budget Caps Are Budget Cuts - Center for American Progress (estimated at an immediate 31% cut to non-defense discretionary spending). 4 republicans voted no, wanting deeper spending cuts. (Matt Gaetz, Andy Biggs, Ken Buck and Tim Burchett of Tennessee, all of whom signed the Texas Supreme Court petition requesting that the Court throw out the certified election results in 4 states won by Biden and authorize the republican controlled legislatures in those states to decide who won) 

There are no moderates among the House republicans-no one is even remotely close. The GOP is not a conservative party but its antithesis. 

The GOP's plan calls for freezing discretionary federal spending at 2022 fiscal levels (excluding defense and veterans benefits) and then increasing spending by 1% per year thereafter for 9 years. What's in the Republican debt limit bill? The proposal, explained-The Washington Post The budget plan also calls for the repeal of most the recently passed Inflation Reduction Act energy and climate tax credits and further seeks to rescind the increased funding for the IRS.  

In exchange for the democrats agreeing to that proposal, the republicans will agree to increase the debt limit by $1.5 trillion or until March 31, 2024, whichever occurs first. 

The House republicans will then refuse to raise the debt limit again, using their tiny vote majority in the House, unless the democrats implement more policy changes that republicans want but could not otherwise implement through following a democratic process. Speaker McCarthy is selling the short time limit as providing an opportunity to cut further early next year. How the House voted on Kevin McCarthy’s debt ceiling bill - Washington Post

Perhaps in a dream world, there will be 1 House Republican who will campaign in 2024 on voting for a 30%+ budget cut in non-defense discretionary spending, explaining honestly and in detail how the cuts will impact his or her constituents. That will never happen of course. It would require them to be forthright. 

DeSantis says state lawmakers will 'formally nullify' Disney's attempt to thwart state takeover;  Disney sues Florida Gov. Ron DeSantis over political retaliation - The Washington Post The Supreme Court has made it clear that corporations have First Amendment rights. Neither a state or Federal Government can punish the exercise of protected speech which is what DeSantis and his Florida authoritarians have done and threaten to do again. While DeSantis denies that he is using the state's power to punish Disney for exercising its constitutional rights, it is clear to me that the Florida republicans are using that power to punish speech that they disfavor and that is straight out of the authoritarian playbook. 

Two of Steve Bannon's associates sentenced to prison in border wall scheme Donald gave Bannon a pardon for his unswerving political support.

A second firm hired by Trump campaign found no evidence of election fraud - The Washington Post; Trump secretly hired two firms for more than $1.35 million to find 2020 voter fraud — they couldn’t - Raw Story - Celebrating 19 Years of Independent Journalism This will not deter Demagogue Don from claiming that the election was stolen from him. 

Trump is racking up GOP endorsements, even amid criminal jeopardy - The Washington Post Many of the Florida GOP representatives have endorsed Donald, spurning DeSantis who is a sanctimonious authoritarian and an influential member of the American Taliban party. 

++++

Putin and His Servile Orcs: 

Russia is and will always be a terrorist state willing to commit war crimes and crimes against humanity on a daily basis. Russians are the Nazis in Ukraine.  

The Orcs targeted a cruise missile at an apartment complex in Uman, Ukraine killing civilians. CNN witnessed bodies being removed from the destroyed apartment building. Deadly Russian air strike hits Ukrainian apartment building; CNN on scene after fatal missile strike on apartment building | CNN

Russia is using violence to implement its objectives in African countries.  

As Russia's Wagner Group plots against Chad, Western concerns mount - The Washington Post  

Russia's Wagner Group mercenaries linked to Sudan's warring generals - The Washington Post

Biden's delay in providing Abrams tanks to Ukraine is inexcusable. 

+++

1. Small Ball Purchases:

A. Added to GOODN- Bought 5 at $18.7; 5 at $18.3; 5 at $17.85; 5 at $17.3 -Schwab Taxable Account: 

Quote: Gladstone Commercial Corp. 6.625% Preferred Series E

Last Discussed: Item # 5.B. Bought 10 GOODN at $19.2 in Schwab Taxable Account (11/8/22 Post) 

Average Cost per share: $18.43  (30 shares)

Yield at AC =  8.99%

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

Issuer: Gladstone Commercial Corp. (GOOD) -Externally Managed Equity REIT. This REIT is primarily a net lease REIT. 

GOOD SEC Filings

2022 Annual Report 

Properties

Website: Gladstone Commercial Corporation

The issuer cut its monthly common share dividend from $.1254 per share to $.10 effective for the 2023 first quarter payment. Gladstone Commercial Corporation (GOOD) Dividend History | Seeking Alpha The reason given was to "increase retained capital in anticipation of further economic headwinds." SEC Filed Press Release 

From the perspective of a Gladstone REIT preferred stock owner, cutting the common share dividend is a positive development since the common share dividend payout was excessive given the current core FFO per share. In the 2022 4th quarter, FFO per share was reported at $.34, down from $.44 in the 2021 4th quarter.  Report for the Q/E 12/31/22 For as long as a cash dividend is paid on the common shares, the preferred stock dividend has to be paid in full. 

Empty Offices Tanked This REIT's Dividend in 2022 -- Now It's Focusing on Industrial Properties-The Motley Fool Industrial properties were at 56% of annualized straight line rent as of 12/31/22, GOOD Investor Presentation.pdf at p. 11.  

While lease renewals on office properties are problematic, I would characterize the primary problems as debt related, which includes too much debt priced at spreads to SOFR, costs to hedge that debt, and the likely higher refinancing costs for maturing fixed coupon mortgages (10-K at page 77, and GOOD Investor Presentation at page 21)

Occupancy was reported at 95.9% as of 2/22/23, 10-K at page 7 

Security: REIT Equity Preferred Stock (senior only to common stock in the capital structure)

Prospectus 

Par Value: $25 (public offering at $25 in September 2019)  

This security is subject to an issuer ATM program. 

Coupon: 6.625% paid on the $25 par value 

Dividends: Paid monthly, non-qualified and cumulative

Dividend Rate: Monthly at $.138021 per share

GOODN Dividend History | Nasdaq

Last Ex Dividend: 4/20/21

Stopper Clause: Standard

Maturity: Potentially perpetual, unless issuer exercises optional redemption right. 

Optional Redemption: On or after 10/4/24 (standard 5 years after IPO)

I also have a common stock position. 

Last Common Stock Stock Discussions: Item # 2.B. Pared GOOD in Fidelity Account - Sold 8 at $16.69 (2/5/23 Post)(reduced my AC per share to $11.68); Item # 3.F. Pared GOOD - Sold 2.197 shares at $20.8  and 2.352 shares at $20.84 (6/4/21 Post)

B. Added to ICMB - Bought 5 at $3.5: 

Quote: Investcorp Credit Management BDC Inc. Overview

Cost: $17.5 

ICMB SEC Filings

Investment Category: Lottery Ticket Basket, deservedly hated BDC. 

Last Discussed: Item # 1.E. Added to ICMB - Bought 5 at $3.73 (4/8/23 Post) I discussed the last earnings report in that post. Investcorp Credit Management BDC, Inc. Announces Financial Results for the Quarter Ended December 31, 2022, and Quarterly and Supplemental Distributions

New Average Cost per share: $4.92 (117+ shares)

Regular Dividend: Quarterly at $.13 per share ($.52 annually)

Investcorp Credit Management BDC, Inc. (ICMB) Dividend History | Seeking Alpha

Yield at New AC =  10.57% (regular dividend only)

C. Bought 10 OLP at $21.85: 

Quote: One Liberty Properties Inc.  (OLP) -  Internally Managed Equity REIT 

Cost: $218.5 

This is my first purchase. 

OLP SEC Filings 

2022 Annual Report (property list starts at page 25; debt discussion starts at pp. F-25, most of the debt is fixed coupon mortgage debt)

Tenants as of 12/31/22: 

Most of the leases are net leases. 

2020-2022 Property Sales: The company has reduced its exposure to retail properties. 

2021-2022 Acquisitions: The REIT bought  industrial properties in 2022. 

Dividend: Quarterly at $.45 ($1.8 annually), last raised from $.43 effective for the 2017 4th quarter payment. 

One Liberty Properties, Inc. (OLP) Dividend History | Seeking Alpha

Yield at $21.85: 8.24%

Last Ex Dividend: 3/24/23

Last Earnings Report (Q/E 12/31/23):  SEC Filing 

FFO per share: $.71

Adjusted FFO per share: $.52, up from $.51 in the 2021 4th quarter

The main deduction from FFO per share was to remove a one time payment of $.22 per share from a ground lease tenant that resulted from a litigation settlement involving an apartment complex in Beechwood, Ohio. The Vue - Apartments in Beachwood, OH   

Occupancy: 99.8% as of 12/31/22, p. 24 Annual Report 

Mortgage Debt: On 67 of 117 properties

2022 Weighted Average Mortgage Interest Rate: 4.14% 

Weighted average term of mortgage debt as of 12/31/22: 6.5 years, p. 3 Annual Report. 

2022 Weighted Average Principal Amount Line of Credit: $16.222M

2022 Weighted Average Interest Rate Line of Credit: 3.42%, up from 1.86% in 2021. 

2022 AFFO per share: $1.98, up from $1.95 in 2021

2022 Dividends per share: $1.8 per share

"In February 2023, the Company sold a property in Hauppauge, New York for $4.2 million. The Company anticipates recognizing a net gain on sale of real estate of approximately $1.5 million during the three months ending March 31, 2023. This property generated $220,000 of rental income in 2022."

Problem Properties: Described at pp. 33-35, Annual Report. 

D. Bought 5 BWG at $7.85: 

Quote: Brandywine GLOBAL Global Income Opportunities Fund Inc. Overview - A Leveraged Bond CEF 

Investment category: Monthly Income Generation. 

BWG SEC Filings 

Brandywine  Global Income Opportunities Fund Inc. - SEC Filed Annual Report for the period ending 10/31/22 (floating rate leverage discussed at pages 44-45) 

SEC Filed - Holdings as of 1/31/23 

Leveraged: Yes, substantial.  

Credit Quality as of 3/31/23: Significant Junk Exposure

Average cost per share: $9.61 (83+ shares)

Dividend:  Monthly at $.08 per share (recent heavy ROC support), reduced from $.09 effective for the April 2023 monthly payment. 

BWG Dividend History | Seeking Alpha

The dividend probably needed to be cut earlier. Leveraged bond CEFs have suffered the infamous Double Whammy, as leverage costs have increased as the value of the bonds bought with borrowed money have gone down. The net interest spreads have contracted significantly compared to 2021, or disappeared entirely, causing less income generation through leverage. The situation may stabilize with the rally in bonds and a halt in FF rate increases after the May 2023 hike. 

I am reinvesting the dividend. 

Yield at New AC: 9.99%

Next Ex Dividend: 5/22/23

Data Date of 4/24/23 Trade: 

Closing Net Asset value per share: $9.24

Closing Market Price: $7.85

Discount: -15.04%

3 Year Average Discount: 11.23%

Sourced: BWG - CEF Connect 

Maximum Position: 200 shares. 

E. Bought 5 BNL at $15.77: 

Quote: Broadstone Net Lease Inc.  (BNL)

Cost: $78.85

BNL SEC Filings

2022 Annual Report

Last Discussed: Item # 1.K. Started BNL-Bought 10 at $16.29 (3/25/23 Post) I discussed the last earnings report in that post. SEC Filed Press Release and Supplemental

New average cost per share: $16.12 (15 shares)

Dividend: Quarterly at $.275 per share ($1.1 annually)

Broadstone Net Lease, Inc. (BNL) Dividend History | Seeking Alpha

Yield at New AC = 6.82%

Last Ex Dividend: 3/30/23 (owned 10 as of)

F. Added 3 PDM at $6.37; 3 at $6.14: 

Quote:  Piedmont Office Realty Trust Inc. Cl A  (PDM)-Office REIT

Cost $37.53

Investment Category: Equity REIT Common and Preferred Stock Basket Strategy

Average cost per share: $10.03 (123+ shares)

Dividend: Quarterly at $.21 per share ($.84 annually)

Yield at New AC = 8.37%

Last Ex Dividend: 2/23/23

Last Discussed: Item # 1.F. Added to PDM - Bought 5 at $7.03; 5 at $6.52 (3/25/23 Post) 

Last Substantive Discussion: Item # 3.C. Added 5 PDM at $10.3 (2/20/23 Post) I discussed the last earnings report in that post. SEC Filed Press Release

PDM is scheduled to release its first quarter report next Monday. 

Office REIT stocks are currently well below the lowest price levels hit during March 2020, and many stock prices are below the lowest prices hit in March 2009.  

PDM prices in March 2020: 

The consensus opinion is that Office REITs will not recover from the work from home trend and their fate will be worse than shopping malls. 

Website: Home - Piedmont Office Realty Trust

Pictures of Office Properties

Atlanta 

Boston 

Dallas 

Minneapolis 

New York  (1 at 60 Broad Street)

Orlando 

Washington D.C. 

G. Added to TSLX - Bought 1 at $17.87:

Quote: Sixth Street Specialty Lending Inc. (TSLX)

Management: External 

TSLX SEC Filings

2022 Annual Report (Risk factor summary starts at page 30 and ends at page 58; summary list of investments starts at page F-6) 

5 year Financial Summary: 

Net asset value was relatively stable. 

Average cost per share: $18.41 (22+ shares)

Regular Dividend: Quarterly at $.46 per share ($1.84 annually)

A special dividend of $.09 per share was paid in the first quarter.  

Yield at New AC: 10%  (regular only)

Last Discussed: Item # 2.D. Added to TSLX - Bought 5 at $18.3; 5 at $18.1 (12/13/22 Post) 

Last Earnings Report (Q/E 12/31/22): SEC Filing 

Net asset value per share: $16.48

NII per share: $.65, adjusted to $.64 to account for capital gain incentive fee. 

Debt at Floating Rates: 98.9%

Weighted average yield of debt investments (amortised cost): 13.4%

"As of December 31, 2022, the Company’s portfolio based on fair value consisted of 90.3% first-lien debt investments, 1.5% second-lien debt investments, 1.8% structured credit investments, 0.4% mezzanine debt investments, and 6.0% equity and other investments." 

781 portfolio companies

"As of December 31, 2022, non-accrual investments represented less than 0.01% of the portfolio at fair value."

Aggregate fair value of investments as of 12/31/22: $2.7879B. 

H. Added to THFF - Bought 2 at $34; 3 at $32.9: 

Quote: First Financial Corp. (Indiana)

"First Financial Corporation (NASDAQ:THFF) is the holding company for First Financial Bank N.A. First Financial Bank N.A., the fifth oldest national bank in the United States, operates 71 banking centers in Illinois, Indiana, Kentucky and Tennessee."

Cost: $166.7

Properties at pages 28-29 

SEC Filings

THFF Analyst Estimates | MarketWatch (2023 E.P.S. consensus at $5.05)

Investment Category: Regional Bank Basket Strategy

Last Discussed: Item # 2.K. Added to THFF - Bought 3 at $43.96 (4/7/22 Post); Item # 1.A. Started THFF - Bought 5 at $45.7; 2 at $45.12; 3 at $44.7 2 at $44.35 (1/22/22 Post)

5 Year Financial Data Summary: 

The 2022 dividend payout ratio was just 21.68%. 

Dividend: Semiannual 

THFF Dividend History | Nasdaq

Last 2 SemiAnnual Dividends Per Share: $1.28

Average cost per share: $42.01 (20 shares)

Yield at New AC: 

Last Ex Dividend: 1/5/23  

The next semiannual dividend goes ex in June. 

Last Earnings Report (Q/E 3/31/23): SEC Filing 

E.P.S. $1.33

Consensus at $1.246 per Fidelity. 

NIM: 3.96%, up from 3.16% in the 2022 1st Q.  

Efficiency Ratio:  58.73%

NPL Ratio: .39%

Coverage Ratio: 328.06% (allowance for credit losses to NPLs)

Charge off ratio: .26% 

ROE: 13.1%

Tangible Book Value per share: $34.16 

"Total deposits were $4.17 billion as of March 31, 2023, compared to $4.40 billion as of March 31, 2022. On a linked quarter basis, total deposits decreased $203.5 million, or 4.66% from $4.37 billion."

"Average total deposits for the quarter ended March 31, 2023, were $4.25 billion versus $4.43 billion as of March 31, 2022."

2022 Annual Report

Owned Securities: 

Net unrealized loss at $168.145M as of 12/31/22 

Average Deposits by year:

P. 42

Deposits as of 12/31/22: $4.3688+B (non-interest bearing at $857.92M), page 49.  

Timed Deposits exceeding $250,000 = $50.6M, page 80. 

I. Added to CVBF - Bought 3 at $14.81: 

Quote:  CVB Financial Corp.  (CVBF)

CVBF SEC Filings

CVBF Analyst Estimates | MarketWatch (2023 consensus E.P.S. currently at $1.78)

Cost: $44.43

Last Discussed: Item # 2.I. Added to CVBF - Bought 2 at $15.12 (4/22/23 Post) 

Average cost per share: $15.65 (15 shares)

Dividend: Quarterly at $.20 per share

Yield at new AC: 5.11% 

Last Ex Dividend: 4/4/23

Last Earnings Report (Q/E 3/31/23): SEC Filing 

Comparisons are to the 2022 first quarter. 

E.P.S. = $.42, up from $.31

Consensus Estimate at $.44

NIM: 3.45%, up from 2.9%  

Efficiency Ratio: 39.5%, down from 46.93%

NPL Ratio: .07%

NPA Ratio: .04%

Coverage Ratio: 1,401.46%

ROA: 1.47%, up from 1.06%

ROTE: 20.59%, up from 13.08%. 

Tangible Book Value per share: 

"At March 31, 2023, investment securities available-for-sale (“AFS”) totaled $3.20 billion, inclusive of a pre-tax net unrealized loss of $459.7 million"

Held to Maturity Securities: $2.54B (no information on unrealized loss in the press release)

Non-interest bearing deposits: 63.92% of the total which is the highest that I have seen and recall. 

My interest rate risk management grade remains a C. Item # 1.D. If I did not have such an unfavorable opinion, I would be buying more shares. 

"Total loans and leases, at amortized cost, of $8.94 billion at March 31, 2023, decreased by $136.9 million, or 1.51%, from December 31, 2022. After adjusting for seasonality of dairy and livestock and PPP loans, our core loans declined by $6.5 million, or 0.07%, from the end of the fourth quarter."

J. Added to MBWM - Bought 3 at $27.6: 

Quote: Mercantile Bank Corp.

Cost: $82.8

MBWM Analyst Estimates | MarketWatch

MBWM SEC Filings

New Average Cost per share: $29.25 (20 shares)

Dividend: Quarterly at $.33 per share ($1.32 annually)

Mercantile Bank Corporation (MBWM) Dividend History | Seeking Alpha

Yield at New AC = 4.51%

Next Ex Dividend: 6/1/23

Last Discussed: Item # 2.H. Added 2 MBWM at $28.75; 5 at $28.6  (4/22/23 Post) I discussed the 2023 first quarter earnings report in that post. SEC Filing I viewed the report favorably. 

K. Added to STBA - Bought 2 at $26.45: 

Quote: S&T Bancorp Inc. (STBA)

Cost: $52.9

STBA Analyst Estimates | MarketWatch

STBA SEC Filings 

Last Discussed: Item # 2.E. Added 5 STBA at $28.8; 2 at $27.72; 3 at $27.6 (4/22/23 Post) I discussed the last earnings report in my last post. SEC Filing and SEC Filed Slide Presentation

Based on the last earnings report, which I viewed positively, I do not believe the STBA stock price decline occurring after that release to be justified. However, regional bank stocks are in a major downtrend largely caused by the recent collapses of Silicon Valley Bank and Signature Bank, as well as the well publicized problems of First Republic. My adds are consequently extremely cautious.   

New Average cost per share: $30.25 (22 shares)

Dividend: Quarterly at $.32 per share ($1.28 annually)

S&T Bancorp, Inc. (STBA) Dividend History | Seeking Alpha

Yield at New AC: 4.23%

Last Ex Dividend: 2/9/23

Dividend Payout Ratio (2023 1st quarter): 31.37%

I do not have access to any analyst reports. 

2. CDs - FDIC Insured: $16,000

Payments for these CD purchases were sourced from matured T Bills, with the proceeds paid into my Schwab sweep account that has a .45% yield.  

A. Bought 2 HTLF 5% CDs Maturing on 10/30/23: 

Operating subsidiary of the bank holding company Heartland Financial USA Inc. (HTLF) 

B. Bought 2 M&T Bank 5% CDs Maturing on 4/26/24: 

Operating subsidiary of the bank holding company M&T Bank Corp. Stock  (MTB) 

C. Bought 1 UBS Bank 4.7% CD Maturing on 4/28/25: 

Interest paid monthly. 

D. Bought 2 Merchants Bank 4.95% CDs Maturing on 7/28/23: 

Issuer: Operating subsidiary owned by the bank holding company Merchants Bancorp (MBIN) 

MBIN Analyst Estimates | MarketWatch

MBIN SEC Filings 

I do not own the common shares. I have a small ball position in a fixed-to-floating rate equity preferred stock issued by this bank holding company (currently at 20 shares). I will discuss adding 5 shares to that position in my next post. 

Merchants Bancorp Preferred Series A (MBINP)(7% fixed coupon paid on a $25 par value to but excluding 4/1/24, then, if not called at par value, at a 460.5 basis point spread to the 3 month Libor which will end up having to be the alternative SOFR rate, Prospectus)

E. Bought 1 Wells Fargo 4.8% CD Maturing on 5/2/25: 

Interest Paid Monthly. 

F. Bought 2 Wells Fargo 4.9% CDs Maturing on 11/4/24: 

Interest Paid Monthly

G. Bought 2 Associated Bank 5.05% CDs Maturing on 11/6/23: 

Issuer:  Operating subsidiary for the bank holding company Associated Banc-Corp.  (ASB) 

I have a small ball position in ASB. 

H. Bought 2 Key Bank 5% CDs Maturing on 8/7/23: 

Issuer: Operating subsidiary for the bank holding company KeyCorp (KEY) 

3. Corporate Bonds: $6,000 in principal amount (total cost at $5,835.02)

Bank holding company senior unsecured bonds have declined in value after the SVB Financial failure. 

When the FDIC seizes the operating subsidiary, the primary asset of a bank holding company, a bankruptcy filing will follow. 

Common and preferred shareholders will be wiped out and senior unsecured debt owners will take a major haircut.

SVB Financial had more assets than most bank holding companies, and consequently the decline in value was from around $98 to the current $69. Finra Page for SVB Financial 3.5% SU Maturing on 1/29/25 Interest is not currently being paid. 

I am mentioning the risk in bank holding company bonds again since I bought 4 as discussed below (1 KEY SU, 1 FNB SU, 2 TFC SU). 

One of the more absurd third party prices: 

At 91.98, the value of the two bonds would be $1,839.6.  (91.98 x. 10 = 919.8 x. 2 = $1,839.6) 

I own two of those bonds that mature next Monday. The third party price was from 4/26/23. 

Fidelity shows as "processing" on Saturday a payment that will be made the following Monday. 

So using the third party price, I gain $160.4 or 8.72% in just 5 days.  

Other bond maturities on 5/1/23- Fidelity Account: 

A. Bought 1 KeyCorp 4.15% SU Maturing on 10/29/25 at a Total Cost of 95.585: 

Issuer: KeyCorp (KEY) - Bank Holding Company. 

KEY SEC Filings 

SEC Filed Earnings Press Release for the Q/E 3/31/23 (net income of $275M after a $126M build in loan loss reserves, which was a standard response among super regional and money center banks in response to a possible decline in the economy)

Finra Page: Bond Detail (prospectus not linked)

Credit Ratings: Baa1/BBB+

The price paid is not consistent with that rating. 

YTM at Total Cost: 6.074%

This YTM is closer to a high junk rating or at most a slightly stressed BBB-.    

Current Yield at TC = 4.34%

B. Bought 2 Avangrid 3.2% SU Maturing on 4/15/2025 at a Total Cost of 96.276:

Issuer: Avangrid Inc. (AGR) - Utility Holding Company

AGR Analyst Estimates | MarketWatch

AGR SEC Filings 

I no longer have a position in the common stock, preferring to own the higher yielding (YTM) SU bond. The common stock has a higher yield than the current yield of this bond. 

I now own 6 bonds. 

Finra Page: Bond Detail (prospectus linked)

Credit Ratings: Baa2/BBB

YTM at Total Cost: 5.214%

Current Yield at TC = 3.32% 

C. Bought 1 FNB 5.15% SU Maturing on 8/25/25 at a Total Cost of 96.819: 

Issuer: F.N.B. Corp. (FNB)

FNB Analyst Estimates | MarketWatch

FNB SEC Filings

I have eliminated my position in the common stock earlier this year. Item # 2.E. Eliminated Remaining FNB - Sold 15+ at $14.33 (2/5/23 Post)(profit snapshot = $117.17); Item # 4.A. Eliminated FNB in Schwab Account - Sold 50+$13.045 and Item # 4.B. Eliminated FNB in Vanguard Taxable Account - Sold 57+ at $13.28 (1/10/23 Post)(profit snapshot = $651.75). 

The 2023 first quarter earnings report was okay IMO. SEC Filing 

I now own 3 bonds. 

Finra Page: Bond Detail (prospectus not linked)

Prospectus

Credit Ratings: Baa2/BBB- 

YTM at Total Cost: 6.641%

Current Yield at TC = 5.32%

D. Bought 2 Truist 3.75% SU Maturing on 12/6/2023 at a Total Cost of 99.073: 

Issuer: Truist Financial Corp.  (TRC) - Super Regional Bank Holding Company

TFC Analyst Estimates | MarketWatch

TFC SEC Filed Earnings Press Release for the Q/E 3/31/23 

TFC SEC Filings 

Last Bond Offering (1/2023): Prospectus ($1.5B, fixed-to-floating rate SU) 

FINRA Page: Bond Detail (prospectus not linked)

The bond was issued when Truist's name was BB&T.  

Credit Ratings: A3/A-

YTM at Total Cost: 5.349%

Current Yield at TC = 3.79%

I have a small ball position in the common stock that has a higher yield. 

4. Treasury Bills: 

A. Bought 2 Treasury Bills at 4/24/23 Auction: 

Matures on 10/26/23

In the event the republicans cause a U.S. government debt default, causing permanent damage to the U.S. credit rating, I would anticipate that principal and interest payments will resume before this bill matures. 

182 Day Bill

Interest: $48.94

Investment Rate: 5.044%

5. Small Ball Sells: 

For the most part, my sales are duplicate positions held in more than 1 account.

A. Eliminated UL in Vanguard Taxable Account - Sold 8 at $55.33: 

Quote: Unilever PLC ADR

Ordinary Shares: Unilever PLC (U.K.: London)

ADR Ratio: 1 for 1 

British Pound to US Dollar Exchange Rate Chart | Xe

Proceeds: $442.64

I own this stock in three taxable accounts. I eliminated the smallest duplicate position with this trade. 

All brands | Unilever global company website

Investors-Unilever

Profit Snapshot: +$34.47

Last Discussed: Item # 1.P. Added to UL in Fidelity Account - Bought 1 at $43.03 (4/25/22 Post); Item #2.I. Added to UL in Fidelity Taxable Account - Bought 2 at $42.55  (6/9/22 Post)

Unilever ADRs use to trade under both the UL and UN symbols, with the later being the Unilever based in the Netherlands whose ordinary shares were traded in Euros. The two entities combined with UL being the surviving ADR with its ordinary shares traded in British Pence. Completion of Unilever’s Unification | Unilever The U.K. does not currently withhold a dividend tax. I do have to pay a fee out of the dividend to the ADR custodian.  

Dividend: Paid Quarterly 

Unilever PLC Common Stock (UL) Dividend History | Nasdaq

The USD dividend will depend in part on the exchange rate. 

Last 4 Dividends: $1.77 per share, rounded up. 

Yield at $55.33 Using $1.77 = 3.2%

Last Ex Dividend: 2/23/23 

Unilever is a bid of a stodgy stock, but at least I do not have to worry about the firm going bankrupt, the dividend is secure, and earnings are relatively predictable. 

The last financial report caused a small rally in the stock. Unilever reports earnings on a semiannual basis. The first and third quarter reports are "trading statements", with revenues being the primary information contained therein. 

Q1 2023 Results Full Announcement

Realized Gains in UN and UL: $3,648.06

The largest realized gain was on a 70 share lot sold in 2018: 

+$2,412.5

The lot was bought in March 2009. 

The second largest gain was on a 103+ shares UN lot sold in 2015: 

+$497.61

Other UN and UL Trades: 

As with General Mills and other consumer product stocks that I have owned, I have never realized a loss on Unilever shares which is one reason for continuing to have a position.     

B. Eliminated MDT in Fidelity Account - Sold 3+ at $90.45: 

Quote: Medtronic PLC  (MDT)

Proceeds: $335.21

MDT Analyst Estimates | MarketWatch

MDT SEC Filings

MDT Key Metrics- Reuters

This is an elimination of a duplicate position. I am keeping a larger position in my Schwab taxable account (8 shares) and will average down there. Each subsequent purchase must be at the lowest price in the chain and in 1 or 2 share lots. The current lowest price is $77.62 (1/9/23 purchase)   

Profit Snapshot: +$7.79

Last Discussed: Item # 3.O. Added to MDT in Schwab Account - Bought 1 at $81.94 (10/4/22 Post)

Last Substantive Discussion: Item # 3. Added to MDT - Bought 1 at  $86.29 (9/13/22 Post)

Dividend: Quarterly at $.68 per share ($2.72), last raised from $.63 effective for the 2022 second quarter payment. 

Medtronic plc (MDT) Dividend History | Seeking Alpha

Last Ex Dividend: 3/23/23

Yield at $90.45: 3%

I am currently less willing to hold low dividend yielding stocks given the available risk free yields.   

I sold into the recent MDT price rally that started when ABT reported better than expected revenues based on hospitals returning to a more normal buying pattern. Abbott Delivers Q1 Results | Abbott Newsroom (4/19/23)(12.4% growth in medical device revenues) 

MDT Closing Price on 4/18/23: $81.65 

MDT Closing Price on 4/19/23: $84.87, more than twice the volume. 

Recent Article: Medtronic Is Partnering With Nvidia to Create Potentially Game-Changing Tech. Is the Stock a Buy? | The Motley Fool (4/25/23)

Recent Positive News: FDA Approves Medtronic MiniMed™ 780G System - World's First Insulin Pump with Meal Detection Technology* Featuring 5-Minute Auto Corrections Apr 21, 2023

Last Bond Offering (3/23): 

Prospectus 

Last Earnings Report (3rd Fiscal Q/E 1/27/23): SEC Filing 

GAAP E.P.S. $.92, down from $1.10

Non-GAAP E.P.S. $1.30, down from $1.36

Non-GAAP E.P.S. Adjusted for Currency $1.38

 

Revenues: $7.727B, down slightly from $7.763B

In constant currency, revenues were up 4.4% to $8.106B.

Analyst Reports (available to Schwab customers)

Morningstar (4/25/23): 4 stars with a fair value of $112. Discusses the recent FDA approval of the 780g insulin pump that should return the diabetes unit to growth but that did not cause the analyst to increase the FV estimate.   

Argus (4/21/23): Buy with a $110 PT. 

S&P (2/21/23): 4 stars with a 12 month PT of $102

Other MDT Realized Gains: $1,878.09

2011: 239+ Shares +$883.29

2014: 30 Shares +$914.05 

2018: 10 Shares $80.75 

No realized losses, except on two fractional shares bought with dividends, so far. 

C. Eliminated EXG in 2 Taxable Accounts  - Sold 15 at $7.65 and 10 at $7.72: 

Quote: Eaton Vance Tax-Managed Global Diversified Equity Income Fund Overview - Buy-Write CEF 

Proceeds: $192.02

I am eliminating a duplicate positions with these sales. 

I still own 138+ EXG shares in my Schwab account with a AC per share at $6.84. I am not reinvesting the dividend given the historically narrow discount to net asset value per share. I may change that option to reinvestment when and if the discount is persistently in the 12 to 16% range compared to the three year average of 3.95%.

SEC Filings 

SEC Filing- Portfolio as of 1/31/23

Eaton Vance Tax-Managed Global Diversified Equity Income Fund-SEC Filed Annual Report for the period ending 10/31/22

Sponsor's website: Tax-Managed Global Diversified Equity Income Fund (EXG) | Eaton Vance

Investment Category: Monthly Income Generation

Profit Snapshots: $21.65

Dividends: Monthly at $.0553, reduced from $.0689 effective for the November 2022 payment. 

Recent Significant ROC Support which probably caused the dividend cut. 

Last Ex Dividend: 4/21/23

Date Date of 4/26/23 Sale: 

Closing Net Asset Value per share: $8.41

Closing Market Price: $7.62

Discount: -9.39%

Sourced:  EXG-CEF Connect 

Last Discussed: Item # 1.F Pared EXG in Schwab Account - Sold 10 at $10.31 and Item # 1.G. Sold All Fractional Shares Purchased with Dividends in the Fidelity Account at $10.28 (7/2/2021 Post )(profit snapshot = $27.43) 

Largest Annual Gain to Date: $414.31  (Retirement Account) 

D. Eliminated NWFL - Sold 15 at $25.98: 

Quote: Norwood Financial Corp.   (NWFL) 

Proceeds: $389.69

NWFL SEC Filings 

"Norwood Financial Corp is the parent company of Wayne Bank, which operates from fourteen offices throughout Northeastern Pennsylvania and fifteen offices in Delaware, Sullivan, Ontario, Otsego and Yates Counties, New York."

Market Cap: About $208M at $25.98  

52 Week Range: $23-$34.75

The elimination is based on my slightly negative reaction to the last earnings report, an unwillingness to buy more shares, the relatively low dividend yield at the current price compared to other regional bank stocks that reported better earnings, and an overall poor total return performance since my purchases.

There are no analyst estimates. 

Investment Category: Regional Bank Basket Strategy

Profit Snapshot: +$9.44

Dividend: Quarterly at $.29 per share ($1.16 annually)

Norwood Financial Corp. (NWFL) Dividend History | Seeking Alpha

Yield at $25.98: 4.47%

Last Ex Dividend: 4/13/23 (owned all as of)

Last Earnings Report (Q/E 3/31/23): SEC Filing 

Comparisons are to the 2022 first quarter. 

E.P.S. $.71, down from $.87

NIM: 3.25%, down from 3.32%

"During the three-months ended March 31, 2023, the fte yield on interest-earning assets increased 80 basis points compared to the three months ended March 31, 2022, while the cost of funds increased 119 basis points."

Generally, I view a decline in NIM compared to the 2022 first quarter as a significant negative. The decline points to an inadequate interest rate risk management starting in 2021.   

NPL Ratio: .07%

Charge off ratio: .08%

ROTE: 16.42%, down from 16.65%

Tangible Book Value per share: $18.31, down from $19.37 

Investment Securities as of 12/31/22: Annual Report at pages 44-45

Cost: $492.246M

Net Unrealized Loss: $73.329M 

"Securities with a carrying value of $378,472,000 and $339,769,000 at December 31, 2022 and 2021, respectively, were pledged to secure public deposits, securities sold under agreements to repurchase and for other purposes as required or permitted by law. "

6. Interest Payments 5/1/23 - Fidelity Taxable Account:

I did not buy any bonds, treasury bills or CDs in 2021. As interest rates started to to rise in 2022, I did materially increase my allocation to those securities.

The goal was to substantially increase my interest income in 2023 and 2024 compared to 2021.

Interest payments are received throughout each month. Payments are concentrated on the 1st, 15th and last day in each month.

For taxable accounts, treasury bills/notes and CDs are owned in 3 accounts; corporate bonds in 4 accounts; and Tennessee municipal bonds in 3 accounts.

Fidelity Account 5/1/23

Corporate Bonds: $347.38

CDs (Monthly Interest): $40.39

Tennessee Municipal Bonds (5 bond lots): $318.76

Treasury Notes: $155.01

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.