AIO, ARCC, BCE, BBDC, DOW, FENY, FSK, HPPPRC, JPC, KHC, MFC, NCZ, OKE, ROIV, SLRC, SWZ, T, VKTX, WHR, WTFCM

Economy: 

In the second estimate of real GDP growth in the 2024 third quarter, the estimate remained unchanged at a 2.8% annual rate. Gross Domestic Product, Third Quarter 2024 (Second Estimate) and Corporate Profits (Preliminary) | U.S. Bureau of Economic Analysis (BEA)

The PCE price index for the quarter remained unchanged as well at +1.5% but the core PCE price index was revised down by .1% to 2.1%. 

Personal Consumption Expenditure "PCE" Inflation - October 

Personal Income and Outlays, October 2024 | U.S. Bureau of Economic Analysis (BEA)

PCE Annual: 2.3%, up from 2.1%

Core PCE Annual: 2.8%, up from 2.7%

PCE  Month-to-Month: .2%, unchanged

Core PCE Month-to Month: .3%, unchanged

Those numbers are in line with the consensus estimates.

Discussed at PCE inflation October 2024

Trump vows new Canada, Mexico, China tariffs that threaten global trade | Reuters; Hear Mexican president’s response to Trump’s tariff threat - YouTube The stock and bond markets are assuming that Trump's tariff increase threats are bluster and part of an effort to browbeat Mexico and Canada into making concessions that Trump wants. The natural response of those two nations will be to retaliate when and if Trump actually implements the tariff hikes, drastically reducing trade involving the three nations assuming a 25% tariff hike. Canada and Mexico account for about 34% of all U.S. exports. United States Exports By Country (2023 data)

My Video: Trump's Recent Tariff Threats - Potential Impacts on the U S Economy - YouTube

How Will the Trump Tariffs Impact the US Economy? (11/8/24 Publication of the Tax Foundation)

Existing-Home Sales Slid 1.0% in September

My last YT Video (also published here): Has a Long Term Bear Market in Intermediate and Long Term Interest Rates Started - YouTube

Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity, Quoted on an Investment Basis -St. Louis Fed

10 Year Treasury Rate by Year - Multpl Note that the FED surppressed the 10 year yield below 2.5% after WWII starting in 1946 through 1950. When that rate suppression ended, the yields started higher, even though inflation remained tame, a process that I call interest rate normalization.  

Treasury Yield Curve - November 2024: 

10 Year Breakeven Inflation Rate as of 11/26: 2.28%

Nominal Yield at 4.3%

Minus

Real Yield at 2.02%

Resource Center | U.S. Department of the Treasury

If the annual average CPI rate over the next ten years is greater 2.28%, the investor would be better off buying the 10 year TIP yesterday than the non-inflation protected 10 year treasury. 

This does not mean that either purchase would meet an investor's wealth requirements. I will own TIPs in my Roth IRA but I do not need to grow capital in those accounts to meet living expenses. Those accounts will be passed down to my heirs without a withdrawal ever having been made from them. My after tax income from dividends, interest and capital gains exceeds my annual expenses including major one time expenditures like a new roof that I installed earlier this year.    

Why is the 10 year U.S. note yield so much higher than other developed countries: World Government Bonds-Daily updated yields Ten year notes issued by Greece closed at a 3.4% yield yesterday and have a BBB- rating. I don't believe the higher yield for the U.S. 10 year is due to credit concerns but to oversupply issues which will become much worse in the years to come. 

Elon Musk publicized the names of government employees he wants to cut. It’s terrifying federal workers | CNN Business

++++

Allocation Shifts Discussed in this Post: 

Treasury Bills Purchased at Auction: $22,000 in principal amount

Treasury Notes Purchased Secondary Market: $4,000 in principal amount

Investment Grade Corporate Bonds: $19,000 in principal amount

Net Outflow U.S. Common Stocks: -$3,352.34

(consisting of $3,836.19 in proceeds minus $483.85 in purchases)

Net Realized Gains Stocks: +$357.78

(consisting of $409.25 in profits and $51.47 in losses)

Net Outflow Stock Funds: -$49.25  (realized gain at +$49.16 )

(consisting of $127.3 in proceeds minus $78.05 in purchases)

Net Outflow Stocks/Stock Funds: -$3,401.54

Outflow U.S. Equity Preferred Stocks:  -$2,096.74 (realized gain at +$213.13)

Outflow Leveraged Preferred Stock CEF: -$241.79 (realized gain +$47.17)

Outflow Leverage Convertible CEF: -$153.24 (realized gain +$10.85)

2024 Net Outflow Stocks/Stock Funds: -$67,205.73

Since I do not discuss all trades in my posts, the actual net outflow from stocks/stock funds would be several thousand dollars higher.

The fact that I do not need to take stock risks influences my allocation decisions as does my opinion about stock valuations, my age and the yields available on treasury bill, treasury note and short term investment grade corporate bonds as currently being more than satisfactory to cover after taxes my current annual expenses.  

Market Valuation: Is the Market Still Overvalued? - dshort - Advisor Perspectives or Shiller PE Ratio - Multpl

S&P 500 PE Ratio - Shiller PE Ratio | Longtermtrends

The Buffett Indicator: Market Cap to GDP - Updated Chart | Longtermtrends

P/E & Yields (both TTM GAAP and 12 month forward non-GAAP estimates) As of 11/22/24, the S&P 500 P/E using 12 month trailing GAAP earnings was at 24.72, up from 19.69 a year earlier, and the P/E using forward estimated non-GAAP earnings was at 23.45. The numbers are compiled by Birinyl Associates. Both 

++

Any single stock transaction that exceeds $1,000 is not classified as "small ball" and will not be discussed in a small ball section. 

+++

1. Pared SLRC - Sold 85 Shares at $16.35:

Quote: SLR Investment Corp. (SLRC) - Externally Managed BDC

Proceeds: $1,389.86

I sold my highest cost lots. 

2023 SEC Filed Annual Report (Summary of risk factors starts at page 31 and ends at page 71)

Profit Snapshot: $21.24

Last Discussed: Item # 2.A. Pared SLRC - Sold All Shares (17+) Purchased with Dividends at $15.86 (9/12/24 Post)(profit snapshot = $25.46) 

Last Buy Discussion: Item # 1.A. Added 5 SLRC at $14.96 (3/8/24 Post)

New Average cost per share after pare: $14.17 (58 shares)

Snapshot Intraday on 11/18/24 after pare

The average cost per share was reduced from $15.32

Dividend: Quarterly at $.41 ($1.64 annually)

SLRC Dividend History | Nasdaq

Yield at $14.17: 11.57%

Last Ex Dividend: 9/13/24 (owned all as of)

Next Ex Dividend: 12/13/24

Net Asset Value per share history: 

9/30/24:  $18.2

6/30/24:  $18.2 

12/31/23: $18.09

9/30/23:  $18.06

3/31/23:  $18.04

12/31/22: $18.33  

6/30/22:  $18.53

12/31/21:  $19.93

12/31/20: $20.16

9/30/20:  $20.14   10-Q

12/31/19:  $21.44

12/31/18:  $21.75 

12/31/17:  $21.81

12/31/16:  $21.74

12/31/15:  $20.79 

12/31/14:  $22.05

12/31/13:  $22.50

12/31/12:  $22.70

12/31/11:   $22.02

Initial Public Offering: Prospectus February 2010, priced to the public at $18.5. Proceeds to SLRC was at $17.205.

Last Earnings Report (Q/E 9/30/24): SEC Filed Earnings Press Release 

NII per share: $.45, up from $.43 in the 2023 third quarter. 

Portfolio Composition (footnotes omitted): 

SLRC Assessment of Credit Risks:

There was one loan on nonaccrual status. 

Some Other Buy Discussions: Item # 1.D. Added to SLRC - Bought 3 at $14.94 (11/25/23 Post); Item # 1.B. Added to SLRC  - Bought 3 at $14.29 (7/8/23 Post); Item # 2.H. Added to SLRC - Bought 3 at $14.39 (6/17/23 Post); Item #4.H. Added to SLRC in Fidelity Taxable Account - Bought 1  $13.38; 4 at $12.53; 3 at $12.34 (10/11/22 Post)

Sell Discussion: Item # 2.E. Eliminated SLRC in Two Taxable Accounts - Sold  37+ at $15.79 and 30 at $15.79 (3/11/23 Post)(profit snapshots = $66.68)

SLRC Realized Gains to Date (includes RI accounts): +$224.58

Largest Gain (not discussed) = $43.98 (50 Shares)

2016

Goal: Any total return in excess of the dividend payments.  

2. Small Ball Sells: 

A. Pared MFC Again- Sold 5 at $32.79: 

Quote: Manulife Financial Corp.  (MFC)

Proceeds: $163.98 

CAD Priced Shares: Manulife Financial Corp (Canada: Toronto)

Canadian Dollar to US Dollar Exchange Rate Chart | Xe

Last Discussed: Item # 4.B. Pared MFC Again - Sold 5 at $32.38 (11/14/24 Post)(profit snapshot = $104.39). I discussed the last earnings report in that post.  SEC Filed Earnings Press Release

Profit Snapshot: $106.95

Average cost per share: $11.41  (80 shares)

Snapshot Intraday on 11/21 after pare. 

The AC remained unchanged since I am selling part of a 100 share lot bought in 2020. Item # 2.D. Bought 100 MFC at $11.41 (5/9/2020 Post)

Dividend: Quarterly at C$.40 per share

Dividends | Manulife

Dividend In USDs: Manulife Financial Corporation (MFC) Stock Dividend History & Date

Last Ex Dividend: 11/20/24 (owned 85 shares as of)

Yield: It is impossible to calculate the dividend yield precisely for a USD priced share of a Canadian company that pays dividends in CADs that are then converted into USDs for the owners of the USD priced shares. The CAD/USD exchange rate will fluctuate from quarter to quarter and is currently fluctuating in the .71 to .72 range. 

If I took a CAD/USD exchange rate of .71 as an example, and assumed no change in the quarterly dividend of C$.40 per share, the dividend yield at US$11.41 would be about 9.96%. (C$1.6 annual dividend x. .71 CAD to USD = US$1.136 ÷ Total Cost of US$11.41 per share = 9.9562%). If the conversion rate was 1 for 1, the yield would rise to 14.02%.  

Some other sell discussions: Item # 3.B. Pared MFC Again - Sold  5 at $30.36 (10/16/24 Post)(profit snapshot = $94.9); Item # 2.B. Pared MFC - Sold 5 at $29.29 (10/10/24 Post)(profit snapshot = $91.44, discussed second quarter earnings report, SEC Filed Earnings Press Release for the Q/E 6/30/24); Item # 1.G. Eliminated Duplicate Position in MFC - Sold 14 at $20.1 - Fidelity Account (3/6/23 Post)(profit snapshot = $143.61); Item # 1.A. Sold 32 MFC at $20.63 (2/2/20 Post)(profit snapshot = $104.79); Item # 2.A. Sold 20 MFC at $18.78 (11/2/19 Post)(profit snapshot = $7.69); South Gent's Comment Blog # 7: Sold 100 MFC at $18.28 (profit = $481.06; IB Account).  

Lowest price paid in Last 5 years: Item # 2.C. Bought in Fidelity Account 10 MFC at $10.15; 2 at $9.3; 2 at $8.9  (5/9/20 Post) Those lots have been sold. 

Realized MFC Gain In USDs: $1,235.63

Owned Reset Equity Preferred: MFC-PM.TO, reset on 11/20/24 for five years at a  2.36% spread to the five year Canadian bond yield resulting in a new coupon of 5.542%, Manulife Financial Corporation announces Dividend Rates on Non-cumulative Rate Reset Class 1 Shares Series 17 and Non-cumulative Floating Rate Class 1 Shares Series 18; Item # 2.A. Bought 100 MFCPRM:CA at C$15.14 (7/25/20 Post). At a C$15.14, the new yield is about 9.15%. 

Owned SU Bond: 2 SU 4.15% Maturing on 3/4/26, Bond Page | FINRA.org 

B. Eliminated JPC - Sold 30 at $8.06: 

Quote: Nuveen Preferred & Income Opportunities Fund Overview - Leveraged CEF 

Proceeds: $241.79

This fund primarily owns equity preferred stocks, with a heavy concentration in preferred stock issued by bank holding companies. I discussed why I was lightening up on those preferred stocks in my last post. 

Effective Leverage: 37.89% as of 10/31/24

Cost of Leverage Based on the Latest Month: 6.06%, sourced from the sponsor's website: JPC-Nuveen I believe that the month referenced is October. 

The cost of leverage is decreasing due to the decline in short term rates. 

There would not be much, if any, net interest margin between a 6.06% borrowing cost and the yield of investments bought with borrowed money after the fund's expense ratio is deducted from the yield on investments. In that kind of scenario, leverage does not create additional net investment income after expenses, though it will create additional upside or downside risk in net asset value per share based on price changes in owned securities bought with borrowed money. 

Last Discussed: Item # 2.B. Bought 30 JPC at $6.49  (12/9/23 Post) 

JPC SEC Filings

Nuveen Preferred & Income Opportunities Fund - SEC filed annual report for the fiscal  year ending 7/31/24 (JPC information starts at page 58)

Fund Data as of 7/31/24: 

Page 19

Profit Snapshot: $47.17

Data Date of 11/18/24 Trade: 

Closing Net Asset value per share: $8.06

Closing Market Price: $8.03

Discount: -.12%

Average 3 Year Discount: -7.78%

Sourced: JPC - CEF Connect (click "Pricing Information" tab)

When the price discount to net asset value per share narrows and is meaningfully below a 3 year average discount, there is an elevated potential for share price depreciation based simply on an expansion of the discount to historical levels. 

Dividend: Monthly at $.0665 per share

Last Ex Dividend: 11/15/24 (owned as of) 

C. Eliminated Duplicate Position in NCZ - Sold 50 at $3.06: 

Quote: Virtus Convertible & Income Fund II Overview  - Leveraged CEF 

Proceeds: $153.24 

Dividend: Monthly at $.03 per share

NCZ Dividend History-Nasdaq

Last Ex Dividend: 11/12/24 (owned all as of)

Profit Snapshot: $10.85

Virtus Convertible & Income Fund II - SEC Filed Semiannual Report for the period ending 7/31/24. The list of NCZ holdings starts at page 34.

Sponsor's website: Virtus Convertible & Income Fund II | Virtus Investment Partners Most of the securities that have credit ratings are in junk territory, but approximately 52% do not have credit ratings. 

Effective Leverage as of 10/31/24: 37.87%

Data Date of 11/15/24 Trade: 

Closing Net Asset Value per share: $3.45

Closing Market Price: $3.07

Discount: 11.01%

Average 3 Year Discount: -11.32%

Sourced: NCZ  - CEF Connect 

D. Pared Duplicate Position in WHR - Sold Highest Cost 7+ Shares at the Prices Indicated in the Snapshot Below: 

Quote: Whirlpool Corp.  (WHR) 

Proceeds: $782.38

Whirlpool is a large appliance company whose brands include Whirlpool, Maytag, Amana, JennAir, and KitchenAid. Home, Kitchen & Laundry Appliances & Products | Whirlpool

I am lowering my average cost and offsetting some of the capital gains realized in November.  The stock started to plunge after my first purchase. 

Loss Snapshot: Net of -$46.36

New Average cost per share after pares: $89.28 (9+ shares)

Snapshot Intraday on 11/18/24 after last pare

Dividend: Quarterly at $1.75 ($7 annually), last raised from $1.4 effective for the 2022 2nd quarter payment. 

WHR  Dividend History

Yield at New AC per share: 7.84%

Last Ex Dividend: 11/15/25

Last Earnings Report (Q/E 9/30/24): SEC Filed Earnings Press Release

GAAP E.P.S. $2.

Ongoing operations E.P.S. = $3.43

GAAP to Non-GAAP: 

Footnotes for prior snapshot

Whirlpool divested its most of its European, Middle Eastern and Africa operations (EMEA) by transferring them to a newly formed entity that will include the European operations of the Turkish household appliance maker Arcelik. Whirlpool will own 25% of this new entity. Whirlpool to divest most of EMEA ops, form new entity with Turkey's Arcelik | Reuters

Net Sales: $3.993B, adjusted up by currency impacts to arrive at organic net sales. 

Organic Net Sales: $4.069B

Reaffirmed 2024 Ongoing operations E.P.S. of $12 and free cash flow at approximately $500M. 

10-Q for the Q/E 9/30/24 

I own 3 shares in my Schwab account with an average cost per share at $91.72. 

Last Bond Offering (2/24): Prospectus for 5.75% SU maturing in 2034.

Owned SU Bond: I own 2 WHR 3.75 SU notes maturing on 5/1/25. 

E. Pared Duplicate Position in ARCC -  Sold 5 at $21.64  (Fidelity Account): 

Quote: Ares Capital Corp. - Externally Managed BDC

I sold my highest cost 5 shares

Proceeds: $108.2

ARCC SEC Filings

2023 SEC Filed Annual Report (Risk factor summary starts at page 23 and ends at page 52)

Last Discussed: Item # 4.G. Pared ARCC in Fidelity Account - Sold 5 at $21.76 (10/24/24 Post)(profit snapshot = $47.2) 

Last Buy Discussion: Item # 4.C. Added 5 ARCC at $14.3; 5 at $14; 5 at $13.67; 5 at $12.5; 5 at $12.4; 5 at $12; 5 at $11.74; 5 at $10.44; 5 at $9.4 (4/4/20 Post)

Profit Snapshot: $48.01

New Average cost per share: $10.11 (20 shares)

Snapshot Intraday on 11/18/24 after pare  

The AC per share was reduced from $10.5.

Regular Dividend: Quarterly at $.48 per share ($1.92 annually)

ARCC Stock Dividend History & Date

12 cents per share in special dividend were paid in 2022. 

Yield at New AC: 18.99%

Next Ex Dividend: 12/13/24 

Last Earnings Report (Q/E 9/30/24):

SEC Filed Press Release 

Net Investment Income per share: $.57, comfortably exceeds the quarterly dividend and up from $.52 reported in the 2023 third quarter. 

Book Value per share: $19.77, up from $19.24 as of 12/31/23.  

Number of portfolio companies: 535

Weighted average yield of debt investment (accruing): 11.7%

Asset Classes as a % of Fair Value: 

Only 53% First Lien

"As of September 30, 2024 and December 31, 2023, the weighted average grade of the portfolio at fair value was 3.1 and 3.1, respectively, and loans on non-accrual status represented 1.3% of the total investments at amortized cost (or 0.6% at fair value) and 1.3% at amortized cost (or 0.6% at fair value), respectively."

ARCC Estimated Impacts on NII from interest rate changes: 

10-Q for the Q/E 9/30/24 at pages 223-224 

BDCs generally loan money at spreads to a short term interest rate. Consequently, NII will increase as short term rates rise and decrease when they fall. 

An assumption built into the positive impact forecast from rising rates is no material increase in non-performing loans that would lower NII and, at some point, could offset the increase resulting from the increase in short term rates. 

The material increase in non-performing loans may be caused by a variety of factors, alone or in combination, including an increase in borrowing costs causing financial distress for marginal companies, irrespective of an expansion in the economy; poor underwriting standards/bad judgment in making the loan; the economy slipping into a recession; and/or conditions that cause particular companies to fail due to a variety of factors (e.g. increased competition). 

Goal: As with all BDC stocks, success is defined as realizing a total return in excess of the dividend payments when I sell shares. 

So far, of the BDC investments that I own, ARCC has the best long term track record, making it the easiest one to meet my goal for all BDCs.

I also have a low cost position in my Schwab taxable account and in 2 RI accounts. 

ARCC Realized Gains to Date: $1,021.27

F. Pared Duplicate Position in BBDC - Sold 13+ Shares at $10 - Fidelity Account: 

Quote: Barings BDC Inc. (BBDC) - Externally Managed BDC

I sold my highest cost shares. 

Proceeds: $132.48

SEC Filings

2023 SEC Filed Annual Report (Summary of risk factors starts at page 33 and ends at page 68)

Last Discussed: Item # 2.F. Added to BBDC in Vanguard Taxable Account - Bought 10 at $8.67 (12/9/23 Post); Item # 1.A. Added to BBDC - Bought 10 at $8.94 (11/25/23 Post); Item # 3.A. Added 40 BBDC at $7,75 (7/15/23 Post)

Profit Snapshot: +$4.19

Average cost per share this account after pare: $8.38 (47+ shares)

Snapshot Intraday on 11/18/24 after pare

The AC per share was reduced from $8.66.

Dividend: Quarterly at $.26 per share ($1.04 annually)

BBDC Stock Dividend History & Date

Yield at $8.38 AC per share: 12.41%

Next Ex Dividend: 12/4/24

Last Earnings Report (Q/E 9/30/24): SEC Filed Press Release 

NII per share: $.29, exceeds the quarterly dividend of $.26. 

Net Asset value per share: $11.32, up from $11.28 as of 11/23/24. 

More relevant information is in the 10-Q filing.  

Portfolio Breakdown: 

68% First Lien

Borrowing information starts at page 103

A description of non-performing loans starts at page 125. 

"As of September 30, 2024, we had eight portfolio companies with investments on non-accrual, the aggregate fair value of which was $12.8 million, which comprised 0.5% of the total fair value of our portfolio, and the aggregate cost of which was $43.7 million, which comprised 1.8% of the total cost of our portfolio."

Company assessment of credit risks: 

Company assessment of impact on NII from interest rate changes: 

"As of September 30, 2024, approximately $1,851.8 million (principal amount) of our debt portfolio investments bore interest at variable rates, which generally are SOFR-based (or based on an equivalent applicable currency rate), and many of which are subject to certain floors. As of September 30, 2024, approximately $647.8 million (principal amount) of our borrowings bore interest at variable rates (approximately 47.2% of our total borrowings as of September 30, 2024) under the February 2019 Credit Facility and the February 2029 Notes. See “Note 5. Borrowings” to our Unaudited Consolidated Financial Statements for information about the variable interest rates and spreads applicable to borrowings under the February 2019 Credit Facility and the February 2029 Notes."

G. Pared Duplicate Position in BBDC - Sold 20 at $10.08 - Vanguard Account: 

See Item # 2.F. above

I sold my highest cost shares. 

Proceeds: $201.69

Loss Snapshot: -$5.11

New Average cost per share this account: $8.23

Price as of 11/21/24 Close

Yield at New AC = 12.64%

I have two duplicate positions in taxable accounts and may eliminate 1 early next year provided the price is over $10. The primary position is in my Schwab account where the sweep account pays only .1%. 

H. Sold 5 T at $22.98; 5 at $23.01 in Schwab Account: 

Quote: AT&T Inc. (T)

I sold my highest cost shares in my Schwab account. 

Proceeds: $229.98

T Analyst Estimates | MarketWatch

T SEC Filings

Investment Category: Bond Substitute

Profit Snapshots: +$41.11

New Average cost per share this account: $17.51 (35+ Shares)

Snapshot Intraday onf 11/21/24 after second pare

The AC per share was reduced from $17.81

Dividend: Quarterly at $.2775 per share ($1.11 annually)

AT&T Inc. (T) Dividend History | Nasdaq

I am not reinvesting the dividend. 

Yield at New AC of $17.51: 6.34%

Last Ex Dividend: 10/10/24

Last Earnings Report (Q/E 9/30/24): I discussed the most recent earnings report in a recent post: Item # 2.C. Pared AT&T in 2 Taxable Accounts - Sold 5 at $22.37; 5 at $22.22 (10/31/24 Post)(profit snapshot = $38.89); SEC Filed Press Release

I. Pared TRP - Sold 3 at $49.91: 

Quotes: 

USDs: TC Energy Corp. (TRP) 

CADs: TC Energy Corp. (Canada: Toronto) 

I sold my highest cost shares. 

Proceeds: $149.73

The USD priced TRP will generally reflect the share price traded on the Toronto exchange as converted into USDs.

Ideally, I would want to see the CAD increase in value against the USD after my purchase since that will increase my dividend yield, as the CAD dividend purchases more USDs, and will also result in the USD priced shares outperforming the shares traded on Toronto exchange. That has not been the case recently as the CAD/USD exchange rate has declined some. (.745 on 9/25/24 and at .717 on 11/25). Canadian Dollar to US Dollar Exchange Rate Chart | Xe) 

Over the past three months through 11/22, the USD priced TRP rose 21.43% as the CAD declined in value, whereas the CAD priced shares gained 25.57%. 

Investor Relations:  TC Energy — Home

Last Buy Discussion: Item # 3.A. Added to TRP - Bought 2 at $37.29; 1 at $36.35; 1 at $36.15; 1 at $33.6 (7/29/23 Post)

Profit Snapshot: +$37.71

New Average cost per share: $34.53 (25 shares)

Snapshot Intraday on 11/18/24 after pare

The AC per share was reduced from $34.83. 

Dividend: Quarterly at C$.96 per share (C$3.84 annually). 

TC Energy — Dividend Information

The CADs will be converted into USDs for owners of the USD priced TRP shares. If the position is held in a U.S. citizens taxable account, Canada will withhold a 15% tax, but will not tax a dividend paid into a U.S. citizens retirement account, assuming the broker is claiming tax treaty rights at the source.   

Yield: The dividend yield before the Canadian tax can not be calculated due to changes in the CAD/USD exchange rate. Generally, an increase in the CAD/USD since the prior payment will result in a one quarter dividend yield increase and a decrease when the CAD buyers fewer USDs. 

If I assume for illustration purposes a perpetual exchange rate of .71 and 1 to 1, and taking the total cost per share of US$34.53, the dividend yield at the current C$3.84 annual dividend would be 7.9% at the .71 conversion rate and at 11.12% with a conversion rate at 1 to 1. 

Foreign Tax: Credit or Deduction? | Charles Schwab

Last Ex Dividend: 9/27/24

TC Energy’s outlook highlights solid growth, low risk, repeatable performance at 2024 Investor Day (11/19/24)

Last Earnings Report (Q/E 9/30/24): SEC Filed Earnings Press Release 

All amounts are in Canadian dollars. 

E.P.S. at $1.03, up from $1 in the 2023 third quarter. 

Segment Earnings: 

Revenues: $4.083B, up from $3.94B

TRP Reset Equity Preferred Stocks: I own 250 shares of both TRP-PD.TO and TRP-PE.TO. I generally discussed the terms of those preferred stocks here: Item # 4.A. Sold 10 TRP at $47.47 (10/24/24) 

J. Pared OKE - Sold 1 Share at $111.71 - Schwab Account: 

Quote: ONEOK Inc (OKE) - Energy Infrastructure

Proceeds: $111.71 

Website:  ONEOK, Inc.

OKE SEC Filings 

10-Q for the Q/E 9/30/24 

Recent Acquisitions: OKE has been on an acquisition spree since I first purchased shares in 2020:

ONEOK Announces Closing of Medallion Midstream Acquisition (10/31/24); 

ONEOK Announces Closing of Controlling Interest in EnLink from Global Infrastructure Partners (10/15/24)

ONEOK Announces Completion of Magellan Midstream Partners Acquisition (9/25/23); 

ONEOK Completes Acquisition of Gulf Coast NGL System (6/17/24)

Recent Announced Dispositions: 

ONEOK Announces Agreement to Sell Wholly Owned Interstate Natural Gas Pipelines to DT Midstream (11/19/24)($1.2B in cash)

Profit Snapshot: +$83.79

I wanted to sell only my fractional shares bought with 2 dividend payments, but Schwab, unlike Fidelity, will not allow me to sell fractional shares unless I am liquidating the entire position. So I had to include part of a 1 share market buy to round the lot up to 1 share. 

Remaining Shares: 

Price as of close on 11/18/24 

New Average cost per share: $21.44 (8+ shares)

Dividend: Quarterly at $.99 per share ($3.96 annually), last raised from $.955 per share effective for the 2024 first quarter payment. 

OKE Dividend History | Nasdaq

Yield at $21.44: 18.47%

Last Ex Dividend: 11/1/24

Last Earnings Report (Q/E 9/30/24): 

ONEOK Announces Higher Third Quarter 2024 Earnings; Increases 2024 Financial Guidance – ONEOK

Net Income of $693M or $1.18 per share 

Selected Financial Results: 10-Q at page -20 

In Millions

Guidance for 2024 with expected future contributions for Enlink and Medallion Acquisitions: E.P.S. midpoint at $5.11 and at a midpoint of $5.02 without those acquisitions.   

I did not attempt to verify the free cash flow numbers provided by these websites: ONEOK Free Cash Flow 2010-2024 | OKE | MacroTrends; OKE Key Metrics page at Reuters

OKE SU Bonds: I own several different ones. 

OKE is calling early my 4 bonds that would have matured on 3/15/24

Fidelity Account

I own 2 OKE 3.2% SU bonds that mature on 3/15/25 and have not yet received notice of an early redemption. 

As part of an income tax recognition shift out of 2024 into 2025, I bought 2 OKE 2.2% SU bonds that mature on 9/15/25 at a Total Cost of 97.868. Bond Page | FINRA.org

I will replace the 4 that will be called on 12/15/24 but I am waiting for higher yields, preferably a YTM over 5%. The most likely one would the 4.25% SU that matures on 9/24/27.  Bond Page | FINRA.org

K. Pared AIO - Sold 4+ at $22.54: 

Quote: Virtus Artificial Intelligence & Technology Opportunities Fund Overview - A Leveraged Balanced  

I sold all of my shares purchased with dividends. I am not currently reinvesting the dividend.  

Proceeds: +$100.35

Virtus AI & Tech Opp Fund (AIO) Portfolio | Morningstar (currently rated at 4 stars). This page lists the top 25 holdings and is accessible to non-subscribers. 

Sponsor's website:  Virtus Artificial Intelligence & Technology Opportunities Fund

Effective Leverage: 14.61% as of 9/30/24

The fund owns common stocks, convertible securities and high yield bonds (junk rated). 

AIO SEC Filings 

Virtus Artificial Intelligence & Technology Opportunities Fund - SEC Filed Semiannual Report for the period ending 7/31/24. The AIO information starts at page 20.  

Financial Date for the 6 months: Realized gains at $42.684M

Page 64, Semiannual Report

Last Buy Discussions: Item # 2.C. Added to AIO - Bought 5 at $15.85; 5 at $15.63; 5 at $15.15 (10/28/23 Post); Item # 2.E. Added to AIO - Bought 3 at $16.37 (10/14/23 Post); Item # 5.B. Bought 5 AIO at $15.7 (10/25/22 Post)

Profit Snapshot: +$32.15

New Average cost per share: $15.27 (45 shares)

Snapshot Intraday on 11/18/24 after pare

Dividend: Monthly at $.15 per share ($1.8 annually) 

AIO Stock Dividend History & Date

The only way for this fund to support this dividend is through capital gains. 

Yield at $15.27: 11.88%

Last Ex Dividend: 11/12/24

Data Date of 11/18/24 Trade: 

Closing Net Asset Value per share: $22.69

Closing Market Price: $22.58

Discount: -.48%

Average 3 Year Discount: -9.24%

Sourced: AIO CEF Connect (Click "Pricing Information" Tab) 

Last Sell Discussions: Item # 2.F. Sold 8+ AIO at $19.66 (3/15/24)(profit snapshot = $22.87); Item #2.F. Pared AIO - Sold 15 at $19.7 (2/15/24 Post)(profit snapshot = $14.18)

Goal: Any total return prior to any ROC adjustments to the tax cost post in excess of the dividend payments. 

I owned a few shares of AIO when it paid a $3.45 per share capital gain distribution in January 2022. I took the dividend in cash. 

M. Pared Duplicate Position in FSK - Sold 25 at $21.57 - Fidelity Account: 

Quotes: FS KKR Capital Corp. (FSK) - Externally Managed BDC 

Proceeds: $539.23

FSK SEC Filings

10-Q for the Q/E 9/30/24 A summary of investments starts at page 5. 

2023 SEC Filed Annual Report (Summary of risk factors starts at page 17 and ends at page 43)

Website: FS/KKR Advisor, LLC 

Last Buy Discussions: Item # 4.E. Added to FSK - Bought 5 at $18.66 (6/24/23 Post); Item # 2.C. Added 10 FSK at $19.6 (6/17/23 Post); Item # 2.O. Added 2 FSK at $19.88 (6/10/23 Post); Item # 7D. Added 2 FSK at $19.1 (12/15/22 Post)

There was a 1 for 4 reverse split in 2020. FS KKR Capital Corp. Announces Effectiveness of Four-to-One Reverse Stock Split

Profit Snapshot: $49.24

New Average cost per share this account: $16.13 (43+ Shares)

Snapshot Intraday on 11/19/24 Pare

The AC per share was reduced from $17.4. 

Dividend: Quarterly at $.64, regular only ($2.56 annually)

FSK Dividend History | Nasdaq

By year end, FSK will have paid $.17 per share in special dividends in 2024, which includes a 6 cent per share special dividend with a 12/4 ex dividend date. 

Yield at $16.13 AC = 15.87% (regular dividend only)

Recent Net Asset Value per share history: 

I view this history negatively and that will probably lead me to eliminate 1 of my two taxable account positions before year end. 

9/30/24:  $23.82

12/31/23: $24.46

6/30/24:  $23.95

12/31/22: $24.89

12/31/21: $27.17

12/31/20: $25.02

12/31/19: $30.54

12/31/18: $31.35

Last Earnings Report (Q/E 9/30/24): 

SEC Filed Press Release 

NII per share: $.77

Adjusted NII per share: $.74

Reconciliation of NII to Adjusted NII: 

Portfolio Data: Note the decline in the weighted average yield of accruing debt investments compared to 6/30/24. 

FSK estimate of impact of interest rate changes on NII: 

10-Q at pages 87-88 for more information

Last Sell Discussions: Item # 4.B. Eliminated 1 of 3 Duplicate Positions in FSK - Sold 12 at $20.35 (9/16/23 Post)(profit snapshot = $14.71); Item # 2.M. Pared FSK - Sold 9+ at $23.04 (3/24/22 Post)(profit snapshot = $.34)(noting that FSK had been a problematic stock for me)

Goal: Any total return in excess of the dividend payments. A penny profit on the stock is viewed by me as a victory.  

N. Sold 1 FENY at $26.95: 

Quote: Fidelity MSCI Energy Index ETF

Last Discussed: Item # 3.A. Pared FENY - Sold 18+ at $23.01 +(7/22/23 Post)(profit snapshot = $187.2; contains snapshots of prior gains) 

Sponsor's website: FENY | ETF Snapshot - Fidelity

Top 10 Holdings as of 10/31/24: 

Of those stocks, I own the energy infrastructure companies KMI, OKE and WMB only. I have previously eliminated my positions in XOM and CVX. 

Profit Snapshot: $17.01

Average Cost per share: $8.28 (10+ shares)

Price as of 11/22/24

Dividends: Variable and paid quarterly

Last 4 Dividends: $.765 per share

Yield at $8.28 AC Using $.765 annual = 9.24%

Last Ex Date: 9/20/24

FENY Realized Gains to Date: $1,019.95 

2. Small Ball Buys: 

A. Added to BCE - Bought 5 at $26.77: 

Quote: BCE Inc. (BCE)

Cost: $122.85

BCE Analyst Estimates | MarketWatch

BCE SEC Filings (foreign issuer forms)

New Average cost per share: $27.36 (15 shares)

Dividend: Quarterly at C$.9975 per share (C$3.99)

The dividend needs to be cut in half IMO. Currently, the total annual dividend of C$3.99 exceeds adjusted E.P.S. which was C$3.21 in 2023 and C$3.35 in 2022. SEC Filing at page 4 

Dividends in USDs: BCE Inc. (BCE) Stock Dividend History & Date

Last 4 Dividends in USDs: $2.94, rounded up

When owned in a U.S. citizens taxable account, Canada will tax 15% of the dividend.

At an annual the dividend yield would be over 10% at my $27.36 AC per share. 

Dividend Yield: The dividend yield before taxes will fluctuate with the CAD/USD exchange rate.  

Next Ex Dividend: 12/16/24

Last Earnings Report: I discussed the last report in a recent post: Item # 5.A. Started BCE - Bought 5 at $27.79; 5 at $27.4 (11/14/24 Post); BCE reports third quarter 2024 results 

B. Added to SWZ - Bought 10 at $7.8:

Quote Swiss Helvetia Fund Inc. Overview  - A USD priced stock CEF that owns Swiss stocks. 

Cost: $78.05

SEC Filings

Sponsor's website: Schroders | SWZ

Last Discussed: Item # 2.C. Sold 10 at $8.81 (10/10/24 Post)(profit snapshot = $11.15); Item # 2.A. Added to SWZ - Bought 10 at $7.56 (5/3/24 Post)

New AC per share: $7.7 (110 Shares)

My tax cost basis has been adjusted down some for ROC sourced dividend distributions. 

Dividend: Quarterly at $.129 per share ($.516 annually)

SWZ Dividend History | Nasdaq

The quarterly rate will generally remain in effect for 3 or 4 quarters and then is reset up or down. This is a managed distribution based on an annual rate of 6% of the funds assets.  

ROC Support for Dividend: The dividend was supported by some return of capital in both 2023 and 2022 as reflected in this table: 

2023 SEC Filed Annual Report at page 24 

Top 10 Holdings as of 10/31/24: 

SEC Filing Holdings as of 9/30/24 In this fund's financial reports, it reports both the cost and value of each investment. The total cost as of 9/30/24 was at $74.1+M with a value then at $126.18+M. 

SEC Filed Semiannual Annual Report for the period ending 6/30/24 

Data Date of 11/21/24 Trade: 

Closing Net Asset Value per share: $9.28

Closing Market Price: $7.82

Discount: -15.75%

Average 3 Year Discount: -14.7%

Sourced: SWZ - CEF Connect (Click "Pricing Information" Tab)

Some of the top holdings, including Roche and Nestle, have poor performers lately.  

The Swiss central bank has artificially lowered the value of the Swiss Franc so that Swiss exporters have a competitive advantage compared to major trading blocs including the Eurozone and the U.S. 

That extreme monetary policy has prevented the CHF from realizing its true value as a safe haven currency. 

One manipulation tactic was to created negative nominal yields on the Swiss National Bank's benchmark rate to September 2022 with the current benchmark rate at just 1% and to drive Swiss government bond yields into negative real yield territory, making the currency as unattractive as possible. Switzerland 10-Year Bond Yield - Investing.com (hovering near .3%); Switzerland Inflation Rate 1960-2024 | MacroTrends; 

Recent performance has been poor: Swiss Helvetia Fund (SWZ) Performance | Morningstar

My main reasons for owning this fund is to have some exposure to Nestle, Novartis and Roche after I eliminated my individual positions in those stocks and to have some assets whose value is priced in Swiss Francs. The actions of the Swiss National Bank have reduced the later reason to an insignificant level and will remain so until it allows the currency to find its market value, if ever during my lifetime.  

As noted in prior posts, I also own a Swiss index stock ETF which has a .09% expense ratio. Franklin FTSE Switzerland ETF (FLSW)

C. Added to KHC - Bought 5 at $31 - Schwab Account: 

Quote: Kraft Heinz Co.

Cost: $155

Packaged food companies have been struggling for several years. 

Some of the issues involve competition from store brands, lower demand resulting from price increases and/or financially constrained consumers, and more consumers opting for what they consider more healthy food choices.   

During the recent high inflation period, their problems were aggravated by rapidly increasing input costs that required them to quickly increase prices. The price increases were significant and caused meaningful declines in volumes. 

The end result has been stagnation in earnings with organic revenue growth, coming mostly from price increases, in barely positive territory or negative year-over-year as volume declines offset revenues generated by price hikes. 

It is has been difficult to generate an acceptable return in this sector which I would generally define for me as the dividend plus at least a 3% annual realized profit on the shares. 

I am buying back 5 of the 6 shares sold in this account. Item # 2.E. Pared KHC - Sold 6 at $38.34 - Schwab Account (1/12/24 Post)(sold highest cost lots, profit snapshot = $16.81)

KHC Analyst Estimates | MarketWatch

KHC SEC Filings

Last Discussed: Item # 2.I. Eliminated Duplicate Position in KHC - Sold 6 at $35.48 - Fidelity Account (8/8/24 Post) I discussed the earnings report for the F/Q ending 6/29/24 in that post.  I noted that organic net sales decreased 2.4% compared to the prior year period.  

Last Buy Discussions: Item # 1.F. Added to KHC in Schwab Account - Bought 4 at $31.92 (7/5/24 Post); Item # 2.B. Added to KHC - Bought 5 at $33.1; 1 at $32.3 (6/20/24 Post); Item # 1.C. Added to KHC - Bought 1 at $31.77; 2 at $31.5; 3 at $31.17; 2 at $30.9 (10/21/23 Post)  

New Average cost per share: $32.6 (40 shares), reduced from $32.83. 

Dividend: Quarterly at $.40 per share, slashed from $.625 effective for the 2019 first quarter payment.   

KHC Dividend History & Date

Yield at $32.6: 4.908%

Last Earnings Report (Q/E 9/28/24):

SEC Filed Earnings Press Release 

Organic sales decreased by 2.2%

GAAP E.P.S. Loss = ($.24) 

Non-GAAP E.P.S. = $.75

GAAP to Non-GAAP Reconciliation: 

The difference of $.99 originates from a non-cash impairment charge included in the GAAP results

Revenues: $6.383B

"Net Sales decreased 2.8 percent versus the year-ago period to $6.4 billion, including a negative 0.4 percentage point impact from foreign currency and a negative 0.2 percentage point impact from divestitures. Organic Net Sales(1) decreased 2.2 percent versus the prior year period. Price increased 1.2 percentage points versus the prior year period, with increases in the North America and Emerging Markets segments partially offset by lower price in International Developed Markets. Favorable price was primarily due to pricing taken in certain categories to mitigate higher input costs. Volume/mix declined 3.4 percentage points versus the prior year period, with declines in the North America and International Developed Markets segments partially offset by volume/mix growth in Emerging Markets. Unfavorable volume/mix was primarily driven by continued shifts in consumer behavior due to economic uncertainty and a decline in Lunchables." (emphasis supplied)

In the last sentence of the preceding quote, the company refers obliquely to a decline in "Lunchables"  sales. This product was being sold to schools and was pulled after a consumer group complained that those lunches were not healthy. Kraft claimed that the decision pulling the product from school lunch programs was unrelated to those health claims.   

Guidance for the 2024 F/Y: Non-GAAP E.P.S. $3.01-$3.07

Using the midpoint of that non-GAAP E.P.S. guidance and a $31 share price, the P/E is about 9.8.

D. Added to DOW - Bought 1 at $44.31: 

Quote: Dow Inc. (DOW)

DOW SEC Filings

DOW  Analyst Estimates | MarketWatch

As previously discussed, chemical companies have been struggling due to lower demand and margin squeeze resulting from input cost inflation. 

IMO, the current price of DOW is inconsistent with the robust economic growth optimism reflected in the ongoing stock market rally. Either the optimism is unwarranted as confirmed by the near future or the price of DOW is too low. 

New Average cost per share: $50.05 (13+ shares), reduced from $50.52.

Dividend: Quarterly at $.70 per share ($2.8 annually)

DOW Dividend History | Nasdaq

I would not characterize this dividend as safe. 

As I recently discussed, another chemical company, Celanese, recently slashed its dividend by 95% based on lower demand for its products. Celanese cuts dividend by 95%, implements cost-cut plans after profit slump | Reuters I have never owned that stock. 

Yield at $50.05: 5.59%

Next Ex Dividend: 11/29/24

Last Earnings Report (Q/E 9/30/24): I discussed the last earnings report in this post: Item #2.G. Added to DOW - Bought 2 at $48.39; 1 at $47.82 (11/7/24 Post); SEC Filed Press Release

Last Discussed: Item # 5.B. Bought 1 DOW at $47.3; 1 at $46.5 (11/14/24 Post) 

Last Sell Discussion: Item # 1.B. Eliminated DOW in 2 Taxable Accounts - Sold 5 at $59.71; 8 at $60.02 (2/13/23 Post)(profit snapshots = $54.14) 

There was some selling pressure after DOW was recently removed from the DJIA index and replaced by Sherwin Williams. 

E. Added to ROIV - Bought 5 at $11.17: 

Quote: Roivant Sciences Ltd. (ROIV)

Cost: $55.85

ROIV Analyst Estimates | MarketWatch

ROIV SEC Filing

ROIV SEC Filed Annual Report for the Fiscal Year Ending 3/31/24

ROIV owns interests in several companies that are pursuing trials in several drug categories. Our Companies | Roivant

As previously discussed, Roche bought the 75% owned ROIV Telavant subsidiary for approximately $7.1B in cash. Roche Completes Acquisition of Telavant from Roivant, Including Rights to Novel TL1A Directed Antibody (RVT-3101) for the Treatment of Inflammatory Bowel Disease Another $110M payment was received in August 2024. ROIV also sold its only commercial drug to Organon. Organon Completes Acquisition of Dermavant, including Innovative Dermatologic Therapy, VTAMA® (tapinarof) Cream, 1% | Roivant Sciences Ltd. (10/28/24)

Investment Category: Lottery Ticket Basket Strategy 

This classification is not based on the current cash position or even the cash burn rate. ROIV has over $5B in cash and short term investments. Instead, the classification is based on the inherent uncertainty whether the pipeline drugs, currently in various stages of clinical trials, will receive marketing approval from regulatory agencies, which I view as necessary to make this investment worthwhile longer term.  The cash cushion provides a long term runway to move drugs through the clinical trial process. 

Last Discussed: Item # 3.C. Started ROIV Bought 10 at $11.85; 10 at $11.5 (10/3/24 Post) 

New Average cost per share: $11.57 

Dividend: None and none expected. 

Last Loss Report (Q/E 9/30/24): SEC Filing 

"Loss from continuing operations, net of tax was $236.8 million for the three months ended September 30, 2024, compared to a loss from continuing operations, net of tax of $244.6 million for the three months ended September 30, 2023. On a basic and diluted per common share basis, loss from continuing operation was $0.25 and $0.28, respectively, for the three months ended September 30, 2024 and September 30, 2023. Non-GAAP loss from continuing operations, net of tax was $218.7 million for the three months ended September 30, 2024, compared to $154.8 million for the three months ended September 30, 2023."

Cash and Marketable Securities: $5.398+B

Interest Income: $69.773M

The company discusses the progress of clinical trials in this press release.  

Repurchased during the quarter $106M of shares, bringing the total repurchased to $754M.   

As previously discussed, ROIV owns interests in other companies that have drugs in various stages of clinical trials. Those trials are described in the last 10-Q filing, and the last Annual Report in more detail, with the following being what the company calls near term catalysts: 

Ownership Percentages/"near-term catalysts"

10-Q at page 31 

SEC Filed Annual Report for the F/Y ending 3/31/24 

F. Bought 1 VKTX at $53.89; 1 at $51.95:

Quote: Viking Therapeutics Inc.

Cost: $105.84 

Investment Category: Blackjack Hand, part of the Lottery Ticket Basket Strategy

Average cost per share: $52.92 (2 shares)

Viking Therapeutics-Pipeline Overview

Website: Viking Therapeutics 

SEC Filings 

10-Q for the Q/E 9/30/24 

My rationale for restarting a position was summarized in a comment published on 11/22/24. 

The justification involves the progress that has been made in advancing Viking's NASH drug, as reflected in this press announcement:  Viking Therapeutics Presents Results from Phase 2b VOYAGE Study of VK2809 in Biopsy-Confirmed NASH/MASH at the 75th Liver Meeting® 2024 (11/19/24)

Other Recent News: Biden-Harris Administration Takes Latest Step to Lower Prescription Drug Costs by Proposing Expanded Coverage of Anti-Obesity Medications for Americans with Medicare and Medicaid | The White House (11/26/24). I would not count on that happening when Trump becomes President, particularly given RFK's opposition to weight loss drugs. Biden's announcement may be a political maneuver so the Democrats can blame Trump for reversing this expanded coverage for weight loss drugs. 

Last Discussed: Item #1.A. Sold 30 VKTX at $22.84 (5/20/23 Post)(profit snapshot = $551.7) 

Last Buy Discussion: Item # 1.I. Added to Lotto VRTX Bought 5 at $4.67; 3 at $4.32; 10 at $3.95 (1/20/22 Post)

As previously discussed, Viking has in clinical trials a weight loss drug in both injection and pill form. Viking Therapeutics Reports New Data from VK2735 Obesity Program at ObesityWeek® 2024 (11/4/24) 

While both the weight loss and NASH drugs would be appealing to a large pharmaceutical company that has none, making Viking a potential takeover target by a company like Pfizer or Merck, upside in Viking's share price as a standalone company is probably more dependent on the NASH drug being approved for marketing. 

A good argument could be made for transferring marketing rights to the weight loss drug (pill and injection) to a major pharmaceutical company in exchange for a sizable upfront payment, milestone payments and royalties. 

Viking is just not set up IMO to compete with Novo and Lilly who are already selling weight loss drugs.  

Last Loss Report (Q/E 9/30/24): SEC Filed Press Release and 10-Q

Net Loss: $21.036M

GAAP E.P.S. ($.22)

Cash and Short Term Investments: $930.44M 

Net Interest Income: $11.616M

Investment Securities: 

Page 11, 10-Q

The NASH drug is also important to Ligand Pharmaceuticals (LGND) which has licensed the drug to Viking and is entitled to receive milestone and royalty payments:

LGND 2023 SEC Filed Annual Report at page 11 

Royalty Portfolio - Ligand Pharmaceuticals

I also have a position in LGND. 

Last LGND Buy Discussion: Item #1.B. Added to LGND - Bought $30 at $77.22; 1 at $76; 1 at $75; 1 at $73; 1 at $71.8 (3/8/24 Post)

Last Sell Discussion: Item # 5.C. Eliminated Duplicate Position in LGND - Sold 2 at $103.69 - Schwab Account (8/21/24 Post)(profit snapshot = $31.19) 

Current LGND Position - Fidelity Account: 7+ shares with an average cost per share at $73.29.  No dividend is being paid and none is expected. 

Last LGND Earnings Report: Ligand Pharmaceuticals Incorporated - Ligand Reports Third Quarter 2024 Financial Results and Raises 2024 Guidance

3. Corporate Bonds: 

A. Bought 2 Interstate Power 3.4% SU Maturing on 8/15/25 at a Total Cost of 99.1: 

Issuer: Operating utility owned by the utility holding company Alliant Energy Corp. (LNT) 

LNT  Analyst Estimates | MarketWatch

LNT SEC Filings 

LNT SEC Filed Earnings Report for the Q/E Ending 9/30/24 

LNT 10-Q for the Q/E 9/30/24 The Interstate Power & Light results can be found starting at page 6. 

Finra Page: Bond Page | FINRA.org

Credit Ratings: Baa1/A-

YTM at Total Cost: 4.646%

Current yield at TC: 3.43%

Last Bond Offering (9/24): Prospectus 

B. Bought 2 Bank of America 4.45% SU Maturing on 3/3/26 at a Total Cost of 99.688: 

Issuer: Bank of America Corp.  (BAC) 

BAC Analyst Estimates | MarketWatch

BAC SEC Filings 

BAC 10-Q for the Q/E 9/30/24 

Finra Page: Bond Page | FINRA.org

Credit Ratings: A3/BBB+

YTM at Total Cost: 4.698%

Current Yield at TC = 4.464%

I received notice yesterday that BAC will call early a SU note that had limited call protection: 

C. Bought 2 Extra Space Storage LP 3.5% SU Maturing on 7/1/26 at a Total Cost of 98.194: 

Issuer: Operating Entity of Extra Space Storage Inc. (EXR) 

The notes were originally issued by Life Storage that was acquired by Extra Space. Extra Space Storage & Life Storage Announce Closing of Merger (7/20/23)

EXR SEC Filings 

EXR SEC Filed Earnings Press Release for the Q/E 9/30/24 

EXR 10-Q for the Q/E 9/30/24 

Finra Page: Bond Page | FINRA.org

Credit Ratings: Baa2/BBB+

YTM at Total Cost: 4.672%

Current Yield at TC: 3.564%

Last Bond Offering (8/24): Prospectus 

D. Bought 2 Dupont 4.493% SU Maturing on 11/15/25 at a Total Cost of 99.78: 

Issuer:  DuPont de Nemours Inc.  (DD) 

DD Analyst Estimates | MarketWatch

DD SEC Filings 

DD SEC Filed Earnings Press Release for the Q/E 9/30/24 

FINRA Page Bond Page | FINRA.org

Credit Ratings: Baa1/BBB+

YTM at Total Cost: 4.618%

Current Yield at TC: 4.503%

I now own 4 bonds. 

E. Bought 2 McCormick 3.25% SU Maturing on 11/15/25 at a Total Cost of 98.627: 

Issuer: McCormick & Co. Inc. (MKC) 

"McCormick & Company, Incorporated is a global leader in flavor. With over $6.5 billion in annual sales across 150 countries and territories, we manufacture, market, and distribute herbs, spices, seasonings, condiments and flavors to the entire food and beverage industry including retailers, food manufacturers and foodservice businesses. Our most popular brands with trademark registrations include McCormick, French’s, Frank’s RedHot, Stubb’s, OLD BAY, Lawry’s, Zatarain’s, Ducros, Vahiné, Cholula, Schwartz, Kamis, DaQiao, Club House, Aeroplane, Gourmet Garden, FONA and Giotti."

MKC Analyst Estimates | MarketWatch

MKC SEC Filings 

MKC SEC Filed Earnings Press Release for the F/Q ending 8/31/24 

Finra Page: Bond Page | FINRA.org

Credit Ratings: Baa2/BBB

YTM at Total Cost: 4.691%

Current yield at TC: 3.295%    

Last Bond Offering (10/24):  Prospectus 

F. Bought 1 UDR 3.5% SU Maturing on 7/1/27 at a Total Cost of 96.751: 

Issuer: UDR Inc. (UDR) - Apartment REIT and included in the S&P 500.

UDR SEC Filings

Corporate Profile | UDR, Inc.

SEC Filed Earnings Press Release for the Q/E 9/30/24 

I have a small ball position in the common stock. 

Last Discussed: Item # 2.B. Added to UDR - Bought 5 at $41.75 (11/7/24 Post)(discussed last earnings report) 

Finra Page: Bond Page | FINRA.org

Credit Ratings: Baa1/BBB+

YTM at Total Cost: 4.837%

Current yield at TC: 3.6175%

I now own 3 bonds. 

G. Bought 2 General Mills 3.2% SU Maturing on 2/10/2027 at a Total Cost of 96.901: 

Issuer: General Mills Inc.  (GIS) 

General Mills: Brands overview

GIS Analyst Estimates | MarketWatch

GIS SEC Filings 

SEC Filed Earnings Press Release for the Q/E 8/25/24 (first fiscal quarter of the 2025 fiscal year)

I currently own 35 common shares with an average cost of $55.2 per share. 

Last GIS Discussion: Item # 2.B. Pared GIS -  Sold 5 at $75.14 (9/26/24 Post) 

I am replacing in advance of maturity 2 General Mills 4% SU bonds that mature on 4/17/25.Bond Page | FINRA.org  

Finra Page: Bond Page | FINRA.org

Credit Ratings: Baa2/BBB

YTM at Total Cost: 4.684%

Current Yield at TC: 3.3%

Last Bond Offering (1/24): Prospectus 

The proceeds will be used to fund the acquisition of  the "Whitebridge Pet Brands’ North American premium cat feeding and pet treating business (the “Business”), which includes the Tiki Pets and Cloud Star portfolio of brands". GIS has been moving into pet food and treats starting with its 2018 acquisition of Blue Buffalo. General Mills Completes Acquisition of Blue Buffalo Pet Products (4/24/2018)

H. Bought 2 Gilead 3.65% SU Maturing on 3/1/26 at a Total Cost of 98.803: 

Issuer: Gilead Sciences Inc. (GILD) 

GILD Analyst Estimates | MarketWatch

I have a small ball position in the common stock. 

GILD SEC Filings 

SEC Filed Earnings Press Release for the Q/E 9/30/24 

Finra Page: Bond Page | FINRA.org

Credit Ratings: A3/BBB+

YTM at Total Cost: 4.623%

Current Yield at TC = 3.694% 

Last Bond Offering (11/24): Prospectus 

I. Bought 2 Loews 3.75% SU Maturing on 4/1/26 at a Total Cost of 98.879: 

Issuer: Loews Corp.  (L) This is not the retailer. 

I would classify Loews as a holding company that owns interests in unrelated businesses: insurance (publicly traded CNA Financial Corp., 92% owned); packaging (Altium Packaging); hospitality (Loews hotels); and energy infrastructure (wholly owned Boardwalk Pipeline Partners).

L SEC Filings 

L SEC Filed Earnings Press Release for the Q/E 9/30/24 

10-Q for the Q/E 9/30/24 

Investments: $53.089B

Long term debt: $8.821B

L | Loews Corp. Analyst Estimates | MarketWatch

Loews Profile Page at Reuters

Finra Page: Bond Page | FINRA.org

Credit Ratings: A3/A

YTM at Total Cost: 4.608%

Current yield at TC: 3.79%

I now own 4 which includes 2 in a RI account. 

K. Bought 2 Virginia Electric Power 3.15% SU Maturing on 1/15/26 at a Total Cost of  98.368:

Issuer: Wholly owned operating subsidiary of Dominion Energy Inc. (D) 

D Analyst Estimates | MarketWatch

D SEC Filings 

Finra Page: Bond Page | FINRA.org

Credit Ratings: A2/BBB+

YTM at Total Cost: 4.634%

Current Yield at TC = 3.2%

Last Bond Offering (8/24): Prospectus 

The first interest payment will be in January 2025. The "profit" will be realized when the bond matures in January 2026. The bond was purchased with funds in a MM account that was earning monthly dividends in 2024. (My Video: More On Shifting Tax Recognition of Interest Income into 2025 Why I have been doing it in 2024 - YouTube)

4. Treasury Bills Purchased at Auction: 

Given the narrower yields spreads on corporate bonds over treasuries maturing at the same time, I will be cutting back on my corporate bond purchases and buying more treasury bill and notes until the spread widens. The weekly corporate bond purchases will be cut back to below $10,000 in principal amount. 

A. Bought 10 Treasury Bills at the 11/21/24 Auction: 

Matures on 1/25/25

56 Day Bill 

Interest: $69.69

Investment Rate: 4.574%

B. Bought 5 Treasury Bills at the 11/25 Auction: 

90 Day Bills

Matures on 2/27/25

Interest: $55.19

Investment Rate: 4.526%  

C. Bought 5 Treasury Bills at the 11/25 Auction: 

181 Day Bills

Matures on 5/29/25

Interest: $109.1

Investment Rate: 4.498%

D. Bought 2 Treasury Bills at the 11/26 Auction - 2 Accounts: 

1 Year Treasury Bill

Matures on 11/28/25

Interest: $84.74

Investment Rate: 4.388%

I also bought 2 in Roth IRA accounts, one in each. 

5. Equity Preferred Stocks: 

A. Eliminated HPPPRC in Fidelity Account - Sold 125 at $13.76: 

Quote: Hudson Pacific Properties Inc. 4.750% Cumulative Preferred Series C 

Issuer: Hudson Pacific Properties Inc.  (HPP)

HPP SEC Filings

The last earnings report elevated my concerns about credit risk. SEC Filed Press Release for the Q/E 9/30/24 and 10-Q for the Q/E 9/30/24 (debt discussed at pages 28-30)

The dividend yield is not worth the credit risk to me. I have had negative reactions to at least the last four quarterly reports. 

This REIT is struggling and has suspended its common share dividend payment. The two major problems involve the writer, actor and teamster strikes that reduced the demand for Hudson's studio properties, Hudson's significant exposure to west coast office properties, including those located in SF, higher interest rates, and too much debt given the other problems. 

Proceeds:  $1,719.95

Profit Snapshot: $174.34

Last Discussed: Item # 4.A. Pared HPPPRC - Sold 15 at $15.27 (10/24/24 Post)(Loss Snapshot = $21.4)

Prior sell discussion: Item # 5.A. Eliminated Duplicate Positions in HPPPRC - Sold 25 at $14.27 and 40 at $14.22 (3/15/24 Post)(profit snapshots = $155.87)

Last Buy Discussions: Item # 3.A. Added 25 HPPPRC at $12.5 (12/16/23 Post); Item # 5.A. Added 5 HPPPRC at $11.2; 5 at $11.73 (11/18/23 Post)

HPPPRC Prospectus

Par Value: $25 (offered at $25 in November 2021)

Placement in the Capital Structure: Equity Preferred Stock, senior only to common stock. 

Maturity: Potentially perpetual unless called by issuer. 

Optional Call Date: Anytime on or after 11/16/26. Given the low coupon and financial difficulties, I would not expect a call in my lifetime. 

Stopper Clause: Standard. The Stopper Clause prevents the issuer from deferring payment of a cumulative preferred dividend while paying a cash common stock dividend or using cash to buy back common stock. The Clause enforces the preferred stock's superior claim to cash compared only to the common stock. Since HPP has eliminated its common share cash dividend, there is no legal impediment to deferring the preferred dividend payment except using cash to buy back common stock.  

Remaining Position (Schwab Account): I restarted a position in this account and currently own just 15 shares with an average cost per share at $11.98. I will not be buying more until I see meaningful improvement in operations.  

B. Eliminated WTFCM - Sold 15 at $25.12: 

Quote:  Wintrust Financial Corp. Fixed/Floating Non-Cumulative Preferred Series D  (WTFCM)

Proceeds: $376.79

Issuer: Wintrust Financial Corp. (WTFC) - A Bank Holding Company

WTFC SEC Filings

WTFC Analyst Estimates | MarketWatch

SEC Filed Earnings Press Release 

Profit Snapshot: $38.79

Last Discussed: Item # 5.B. Added 5 WTFCM at $21.8 (8/26/23 Post) 

Prospectus

Par Value: $25

Coupon: 6.5%

Stopper Clause: Standard  

As previously discussed, this is a fixed-to-floating rate preferred stock. 

The coupon will transition to a 4.06% spread to the 3 month Libor rate, if not called, for the quarter starting on 7/15/25. The 3 month Term SOFR rate + a tenor spread of .26161% will probably be used instead of the now deceased 3 month Libor rate but that is not certain until it is announced. Term SOFR - CME Group  The coupon would then reset every 3 months. The SOFR rate will decline in tandem with FED rate cuts. 

Dividends: Paid quarterly, qualified and non-cumulative.

For the floating rate to result in a higher coupon than the current 6.5% fixed rate, the 3 month SOFR rate would need to be higher than 2.18% (6.5% - 4.06% spread = 2.44% - .26161% Tenor = 2.18%, rounded up). 

6. Treasury Notes - Secondary Market Purchases:

A. Bought 1 Treasury Note 4% Coupon Maturing on 12/15/25 at a Total Cost of 99.586: 

YTM 4.404%

B. Bought 1 Treasury Note 4.25% Coupon Maturing on 12/31/25 at a Total Cost of 99.8292: 

YTM 4.408%

C. Bought 1 Treasury Note 3.875% Coupon Maturing on 1/15/26 at a Total Cost of 99.451: 

YTM: 4.369% 

I make no effort in trying to confirm a broker's YTM calculation: 

From Schwab

YTM includes the coupon yield, the "profit" earned at maturity, and assumes the semiannual interest payments are reinvested at the coupon rate creating some compounding effect. 

Current Yield: 3.9% rounded up

"Profit" at Maturity: $5.45 for this note purchase. 

I now own 2 notes with the first bought at a slightly higher price on 10/7/24.

There is still a slight decline in YTM as I move further out on the yield curve. That may end up being an incorrect assessment, as currently reflected in the YTM yield curve,  about the future course of inflation and the FEDs response thereto.  

The current assessment that short term rates will continue to decline is firmly embedded in investor expectations, though the consensus is that short rates will not be as low as of 12/31/25 as previously thought a few months ago which has resulted in a minor rise in yields for treasury notes maturing in the 2025 4th quarter and the 2026 first quarter.    

D. Bought 1 Treasury 4.25% Coupon Maturing on 10/15/25 at a Total Cost of 99.8398: 

YTM = 4.432%

Schwab Calculation

I now own 5 notes. 

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.