Economy:
ADP reported that the private sector added 140,000 jobs in February. ADP National Employment Report: Private Sector Employment Increased by 140,000 Jobs in February; Annual Pay was Up 5.1%
The BLS reported that the economy created 275,000 jobs in February. The unemployment rate was reported at 3.9%. Average hourly earnings increased 5 cents to $34.57, following the 18 cent increase in January. Average hourly earnings were up 4.3% over the 12 month period ending in February. The average work week increased by .1. "The change in total nonfarm payroll employment for December was revised down by 43,000, from +333,000 to +290,000, and the change for January was revised down by124,000, from +353,000 to +229,000. With these revisions, employment in December and January combined is 167,000 lower than previously reported." Employment Situation Summary - 2024 M02 Results
Opinion: Biden gets the blame for inflation staying higher for longer, but he shouldn’t - MarketWatch Notwithstanding good GDP, job and wage growth, and inflation returning to average historical levels, 57% of American voters disapprove of Biden's handling of the economy.
February 2024 ISM Services Index 52.6% down from 53.4% in January. The new orders component rose to 56.1% from 55%
Powell reinforces position that the Fed is not ready to start cutting interest rates Powell: "We believe that our policy rate is likely at its peak for this tightening cycle. If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year. But the economic outlook is uncertain, and ongoing progress toward our 2 percent inflation objective is not assured. . . The Committee does not expect that it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent." Testimony by Chair Powell on the semiannual Monetary Policy Report to the Congress - Federal Reserve Board
Powell did testify that rate cuts "can and will begin this year". The most likely scenario is that the first 25 basis point cut will occur no earlier than the July meeting
++++
Asset Allocation Shifts Discussed in the Post:
Treasury Bills Purchased at Auction: $17,000 in principal amount
Corporate Bonds: $12,000 in principal amount
Outflow Common Stocks: -$5,695.92
(Consisting of $6,076.44 in proceeds minus $380.52 in purchases)
Common Stock Realized Gains: +$1,445.68
Inflow Equity Preferred Stocks: +$305.9
2024 Outflow Common Stocks/Stock Funds: -$22,592.13
Are We in a Stock Market Bubble? by Ray Dalio.
Asset allocation in my Fidelity Taxable Account as of 3/8/24:
++++
Trump and His Party:
RealClearPolitics-Election-2024 Republican Presidential Nomination
RealClearPolitics - Election 2024 - General Election: Trump vs. Biden
I will publish a video at YouTube discussing Biden's State of the Union address last night that I did watch. I did not watch the speech to learn more about Biden's positions, since any informed voter already knows about them. I watched primarily to observe his mental condition. Any fair minded person watching that speech would conclude that he was mentally fit. Joe: Biden showed how GOP is on the wrong side of history, polls, decency - YouTube; 'He nailed it': Republican strategist reacts to Biden's speech - YouTube
GOP response a 'chilling reminder' of the future Republicans see for the U.S. - YouTube
Trump does not want the Romney supporters. Trump says Republican Party is ‘getting rid of the Romneys’ – Deseret News; LP Reed Galen's Message to Moderate Republicans - YouTube
The Trump clone Mark Robinson decisively won the republican nomination for North Carolina's governor. Hitler-quoting candidate wins North Carolina Republican gubernatorial primary-The Guardian We now know more about almost 700,000 republicans voters in North Carolina. Robinson's history of anti-semitic and deliberately incendiary comments were well known by the voters who elected him to be the Lieutenant Governor in 2020 and the republican nominee for governor in 2024.
I discussed those incendiary comments in this video: Mark Robinson Republican Candidate for the N C Governor and Likely Primary Winner - YouTube. A summary can be found with links in this Wikipedia article. The only comment to that YT video, other than my own, is from a self-proclaimed Christian who believes Robinson is "Bringing-Back God/Country Common Sense & Sanity!!"
Robinson's bona fides in TrumpWorld as a responsible fiscal conservative were established beyond any doubt by his 3 bankruptcies, failure to pay income taxes for 7 years, being sued for non-payment of debts and being evicted by a landlord for non-payment of rent. Trump endorsed him.
Meet Mark Robinson: The GOP's Next Top Lunatic | The Daily Show - YouTube
Governor Youngkin (R-VA) endorses Trump for President of United Sates - YouTube Trump is the republican party. Youngkin is not now, nor has he ever been, a moderate. He is just a more slick version of Trump.
The Dangerous Durability of Donald Trump | Vanity Fair
Ex-Trump Org. CFO to plead guilty to perjury charges - YouTube; Ex-Trump Org. CFO admits to lying in two depositions related to Trump’s civil fraud trial - YouTube
Van Jones: There’s hope and despair in what happened to my home state | CNN Jones is referring to Tennessee. He discusses the anti-democracy party that now controls my state.
Voters Doubt Biden’s Leadership and Favor Trump, Times/Siena Poll Finds - The New York Times Biden's disapproval rating was 47% in this poll. If the election would be held today, 48% would vote for Trump, 43% for Biden and 10% refused to say or don't know. February 2024 Times/Siena Poll of Registered Voters Nationwide - The New York Times
Trump struggles to say ‘evangelical’ and muddles up Israel in wild, incoherent speech at Christian event | The Independent Donald said he made "Israel" the capital of "Israel". He referred to January 6th convicted rioters as hostages and praised their "tremendous spirit".
'Nonsense': Fact-checker slams Trump's claim during border speech- YouTube; Trump claims Biden in 'conspiracy to overthrow the US' with border policy-YouTube
‘False claim after false claim’: Daniel Dale fact-checks Trump’s remarks after SCOTUS ruling-YouTube Trump is incapable of being truthful.
Trump's false statements and narratives are believed by tens of millions which is only possible by their willingness to remain wilfully ignorant or the continuation of a mental condition that does not allow for the processing of accurate information.
Lying all of the time about almost everything is a path to political power in the U.S.
Trump’s Allies Ramp Up Campaign Targeting Voter Rolls-The New York Times So far, the Trump "investigators" have managed to cause purges of voters rolls in precincts that favor democrats in violation of state procedures for deletions.
‘He can’t complete a sentence’: Joe slams Trump's latest insults - YouTube
'He looks lost': Trump has gaffe-filled weekend on the campaign trail- YouTube; Donald Trump Explodes as Dementia Don Goes Viral - YouTube
The Supreme Court Once Again Reveals the Fraud of Originalism-The Atlantic
New emails show Trump stealing the 2020 election was always Plan A; Emails Reveal Details of Trump Fake Electors Plan - The New York Times
Ronny Jackson (R-TX): Navy demoted congressman in 2022 after scathing watchdog report
Jackson who is currently a republican congressman representing Texas's 13th congressional district was demoted to a Captain in 2022 but still refers to himself as a retired Rear Admiral. The 2021 Inspector General's report found that "that Jackson berated subordinates in the White House medical unit, “made sexual and denigrating statements” about a female subordinate, consumed alcohol inappropriately with subordinates and consumed the sleep drug Ambien while on duty as the president’s physician." Report No. DODIG-2021-057: Report of Investigation Rear Admiral (Lower Half) Ronny Lynn Jackson, M.D. U.S. Navy, Retired (Redacted) Ronny Jackson was demoted by Navy after investigation into White House actions - The Washington Post Jackson is a 100% pure Trumpster. Trump carried that district with 80% of the vote in 2016 and again in 2020, so Jackson is a perfect fit for this congressional district.
++++
Putin and His Mafia State:
Losses ∙ Russia ∙ WarSpotting — documented material losses in Russo-Ukrainian war
Sweden officially joins NATO, becoming alliance’s 32nd member | CNN NATO is simply a defensive alliance designed to deter Russia from invading a member state. Finland and Sweden reacted rationally by joining NATO in response to Russia's invasion of Ukraine.
Zelensky: Russian missile strike hits near Ukraine and Greek leaders in Odesa | CNN; Russian missile hits near Zelensky motorcade in Ukraine city of Odessa - The Washington Post The missile landed near the motorcades carrying Zelensky and the Greek Prime Minister. Putin is an incredibly reckless and murderous psychopath.
Putin warns of 'destruction of civilization'. Hear retired general's response - YouTube
Explosion damages key Russian railway bridge-POLITICO; Ukraine blows up Russian railway bridge-Ukraine-YouTube
Ukraine sinks Russian Black Sea patrol ship Sergey Kotov near Crimea; Ukrainian sea drones sink $65 million Russian patrol ship off Crimea - YouTube
Smoke Billows Over Russian Oil Terminal Used for 'Military Purposes': Video
Ukrainian drones 'strike Russian fuel and lubricants warehouse' - YouTube; Russia’s governor: Two Ukrainian drones hit fuel and lubricants depot in Kursk Oblast - Euromaidan Press
Children among people killed in Russian drone strike on southern Ukraine | ABC News - YouTube Russia targeted an apartment building in Odessa.
+++++
1. Small Ball Buys:
A. Added to SLRC - Bought 5 at $14.96:
Quote: SLR Investment Corp. (SLRC)- Externally Managed BDC
Cost: $74.8
2023 SEC Filed Annual Report (Summary of risk factors starts at page 31 and ends at page 71; summary of investments starts at page 115)
I do not have access to any brokerage reports. B. Riley Securities and J.P. Morgan have neutral ratings with a $16 and $15 price target respectively. As with all BDC investments, the objective is to exit the position at any total return in excess of the dividend payments before any ROC adjustment to the tax cost basis.
Last 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)
New Average cost per share: $15.22 (160+ shares)
Dividend: Quarterly at $.41 per share ($1.64 annually)
I have turned off dividend reinvestment after the 2023 third quarter payment.
I took the last dividend payment in cash:
Yield at AC per share: 10.775%
Next Ex Dividend: 3/13/24
Net Asset Value Per share history: While there has been some drifting down in net asset value per share, the $18.06 number is still higher than the proceeds to SLRC from its 2010 IPO.
12/31/23: $18.09
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 12/31/23): SEC Filed Press Release
Net Investment Income: $23.9M
NII per share: $.44
First Lien Loans: 97.7%
Floating Rates: 65.3%
Asset Quality: 99.4% of portfolio performing on a cost basis. There was only 1 non-accruing loan.
B. Added to LGND - Bought $30 at $77.32; 1 at $76; 1 at $75; 1 at $73; 1 at $71.8:
Quote: Ligand Pharmaceuticals Inc. (LGND)
Cost: $305.72
LGND Analyst Estimates | MarketWatch
New average cost per share: $76.26 (7+ shares)
Diluted Shares Outstanding as of 12/31/23: 17.466M
As of 9:oo CST on 3/8/24, the last trade was at $73.13. At that price and using the share count as of 12/31/23, the market cap is only 1.277+B.
Cash and short term investments as of 12/31: $170.309M
Given the current price, Ligand needs to be more aggressive in buying back shares IMO.
I discussed LGND and its relationship to Viking Therapeutics Inc. (VKTX) in a comment published on 3/2/24.
LGND owned 6.7M VKTX shares as of 12/31/22, but unfortunately sold 5 million shares during 2023 before the huge price spike in VKTX shares resulting from this announcement. Viking Therapeutics Announces Positive Top-Line Results from Phase 2 VENTURE Trial of Dual GLP-1/GIP Receptor Agonist VK2735 in Patients with Obesity (2/27/24 Press Release)
LGND spiked in price, possibly due to a mistaken belief that LGND owned VK2725 and had licensed that compound to VKTX, and/or LGND still owned most of its VKTX shares which was not the case.
I pointed out in a comment that LGND had licensed other compounds to VKTX, but VK2725 was not one of them. (See Viking 2023 Annual Report at pages 10-11 for more information on the master license agreement with Ligand)
Among the compounds licensed by LGND to Viking, the one that is the furthest along in clinical trials is VK2809 that has so far shown promising results for treating NASH. Viking Therapeutics Presents New Data from Phase 2b VOYAGE Study of VK2809 in Patients with Biopsy-Confirmed Non-Alcoholic Steatohepatitis (NASH); Viking Therapeutics VK2809 - Viking Therapeutics LGND has licensed it to VKTX in exchange for milestone payments and mid-single digit royalties.
Summary of VK2809 Trials:
Viking 2023 Annual Report at pages 4-5
As discussed previously, LGND is a drug discovery firm that does not take on the financial risks associated with clinical trials, the costs associated with securing marketing approvals, manufacturing or marketing after approval.
LGND does have an approved compound that it markets, Captisol, but does not manufacture it.
Captisol is used by other drug manufacturers to optimize the stability and solubility of their drugs.
Captisol was used by Gilead for its Covid drug remdesivir. For those use, LGND generated a total of $228.89M in revenues in 2021-2022 but none in 2023 for that use.
The primary user of Captisol now is Amgen in its cancer drug Kyprolis.
Captisol Patent Information at pages 5 and 18, LGND 2023 Annual Report
Ligand recently received FDA approval to market Zelsuvmi, a topical treatment used to treat moluscum which is expected to be available during the second half of 2024. Ligand Pharmaceuticals Incorporated - U.S. Food and Drug Administration Approves ZELSUVMI™ as a First-in-Class Medication for the Treatment of Molluscum Contagiosum This product was originally developed by Novan Pharmaceuticals who filed for bankruptcy. Ligand bought Novan's assets Ligand Acquires Assets of Novan, Inc. for $12.2 Million
My gut has informed me that Ligand's current share price reflects it existing revenue streams from Captisol sales and royalties from approved compounds sold by other drug companies.
What is not known is how many drugs currently in trials may ultimately be approved and how much in milestone payments and royalties LGND will receive from those compounds. The gut part of the equation is that not much of that potential stream of revenues and profits is baked into the current share price IMO. Predicting the future is inevitability problematic and generally amounts to nothing but guesses however.
Licenses for Existing Approved Compounds:
 |
| P. 7 Annual Report |
Licenses for Products in Trials:
 |
| P.11 Annual Report |
The status of the clinical trials is discussed at pages 11-13.
Full product portfolio: pages 13-15
Primrose Bio: LGND also has financial arrangements with a private company called Primrose Bio that includes common (49.9%) and preferred stock. (Pages 6, 19, 74-75) I would not even attempt a guess as to how much that stake may be worth down the road. Ligand Pharmaceuticals Incorporated - Ligand Spins Out and Merges Pelican Subsidiary with Primordial Genetics to Form Primrose Bio; Primordial Genetics, Inc. acquired Pelican Technology Holdings, Inc. from Ligand Pharmaceuticals Incorporated for $49.2 million. -September 17, 2023
Dividends: None and none expected
Last Earnings Report (Q/E 12/31/23): SEC Filed Earnings Press Release
Diluted Shares: 17.676M
GAAP E.P.S. = $1.03
Non-GAAP E.P.S. $1.33
Non-GAAP E.P.S. excluding gain from selling VKTX Shares: $1.05
2024 Guidance: "The Company expects 2024 royalties ranging from $90 million to $95 million, sales of Captisol ranging from $25 million to $27 million and contract revenue ranging from $15 million to $20 million. These revenue components result in total revenue forecast of $130 million to $142 million. Ligand notes that with total revenue of $130 million to $142 million, adjusted earnings per diluted share are expected to range from approximately $4.25 to $4.75."
Viking: I also sold Viking Therapeutics Inc. (VKTX) too early based on subsequent developments. Item # 1.A. Sold 30 VKTX at $22.84 (5/20/23 Post)(profit snapshot = $511.7). The average cost per share was $4.45 for those 30 shares.
 |
| Includes 5 shares sold earlier in 2023 |
If I had waited until March to sell at say $90, the profit would have been about $2,557. My reasoning was that two large drug companies, Eli Lilly and Novo Nordisk already had FDA approvals for weight loss drugs and there was another drug company, Madrigal, that was further along in receiving approval for a NASH drug. I can understand why LGND sold too early as well. Novo Nordisk shares jump 5% on promising weight loss trial results; Eli Lilly dips (3/7/24)(the response is to another Novo weight loss drug called amycretin)
On a more positive note, Viking now has a lot more money that can be deployed in advancing clinical trials of the compounds that are subject to Ligand's license agreements. Earlier this month, Viking sold 6,471,000 common shares in a public offering at $85. The proceeds before Viking's expenses and after the underwriters discount of $4.69+ per share was at $80.3+, raising $519.658+M. Up to another 970,500 shares may be bought by the underwriters under the greenshoe. Prospectus
I collected a number of LGND press releases which highlights its business approach:
Ligand Partner Eisai Receives Approval in Japan for Injection Formulation of Antiepileptic Drug Fycompa® (2/22/24). Fycompa is formulated with Captisol.
Ligand Acquires Royalty on Sanofi’s TZIELD® for $20 Million (11/1/23)
2. Small Ball Sells:
I am continuing to reduce my allocation to regional bank stocks.
There are several reasons for this reduction:
(1) year-over-year declines in E.P.S. and net interest margins;
(2) increasing problems with commercial real estate loans particularly for offices;
(3) overall poor dividend growth over the past five years for several regional bank stocks;
(4) stock charts consistent with an ongoing bear market with no clear signs that stock rallies can be sustained;
(5) the FDIC special assessment. FDIC: Final Rule on Special Assessment Pursuant to Systemic Risk Determination While I understand why it was necessary for the FDIC to levy a special assessment after covering uninsured deposits at three banks that failed last year, Silicon Valley being the first, I do not like the concept of one company paying for the failures of another, which is necessary in the banking industry; and
(6) Another issue is the sudden discovery of substantial loan losses which recently resulted in a substantial price decline for New York Community Bancorp Inc. (NYCB) With banks, the existence of cockroach hotel may be hidden under a thin veneer of positive financial metrics that do not reflect the true financial condition of the bank. Wall Street worries about NYCB's loan losses and deposit levels NYCB was saying everything was just fine, non-performing loans were low, and then it slashed the dividend, added $552M to its loan loss reserves, disclosed that two major loans were significantly impaired that contributed to $185M in net charge offs taken in the 4th quarter, fired its risk control officers, sacked its CEO, declared a $2.4B impairment charge and said that it found material weakness in its risk management, all occurring over about a 2 week period in February and early March. SEC Filing on Material Weakness in internal controls, risk assessments and monitoring activities
The same concept as the FDIC special assessment was in play when the FED started its Jihad Against Savers in 2008 in order to repair the economy tanked by reckless and imprudent loans made by the Masters of Disaster of who earned millions for their failures and financial "innovations" like the CDO machine described in The Financial Crisis Inquiry Report.pdf at pages 127-153; 223-230.
A. Eliminated FFBC - Sold 60+ at $21.52:
Quote: First Financial Bancorp (Ohio) (FFBC)
Proceeds: $1,295.31
As of 12/31/23, FFBC's operating bank, First Financial Bank, operated 130 full service banking centers located in Ohio, Indiana, Kentucky and Illinois.
FFBC Analyst Estimates | MarketWatch
Profit Snapshot: +$358.63
Last Discussed: Item # 5.A. Pared FFBC in Fidelity Account- Sold 20+ at $25.5 and Item # 5.B. Eliminated FFBC in Vanguard Account -Sold 10 at $25.89 (11/29/22 Post)(profit snapshots = $184.33)
Dividend: Quarterly at $.23 per share, last raised from $.22 effective for the 2019 third quarter payment.
FFBC Dividend History | Nasdaq
Last Ex Dividend: 2/29/24
Last Earnings Report (Q/E 12/31/23): SEC Filed Press Release
Comparisons are to the 2022 4th quarter:
Diluted GAAP E.P.S. = $.60, down from $.73
Non-GAAP E.P.S. = $.62 (among other items, this number excluded the FDIC special assessment)
NIM: 4.26%, down from 4.47%
While NIM declined, the 4.26% number is still better than most banks reported in the 2022 4th quarter.
NPL Ratio: .6%, up from .39%
While .6% is not in the problematic range IMO, the upward trend over the past year is concerning.
NPA Ratio: .38%, up from .23%
Charge off ratio: .46% up from a net recovery of .01%.
As with the NPL Ratio, the .46% charge off ratio is not yet problematic but the uptrend is concerning.
ROTE: 21.36%, down from 29.93%
Tangible Book Value per share: $12.38, up from $9.87
Other Sell Discussions: Item # 1.N. Pared FFBC in Fidelity Account - Sold 25 Shares at $26.2 - Highest Cost Lots (4/1/21 Post)(profit snapshot = $30.91); Item # 3.A. Sold 84+ FFBC at $28.1 (3/24/17 Post)(profit snapshot = $1,129.21); Item # 4 Sold 52 FFBC at $21.25-Update For Regional Bank Basket Strategy As Of 8/18/2016 - South Gent | Seeking Alpha (profit snapshot = $280.72); Item # 1 Sold 50 FFBC at $20.11-Update For Regional Bank Basket Strategy As Of 7/12/16 - South Gent | Seeking Alpha (profit snapshot = $215.98); Item # 3 Sold 50 FFBC at $19.25 Update For Regional Bank Basket Strategy As Of 5/4/16 - South Gent | Seeking Alpha (profit snapshot = $52.76); Item # 4 Sold 57 FFBC at $17.03-Highest Cost Shares (12/23/13)
B. Eliminated RF - Sold 20+ at $18.36:
Quote Regions Financial Corp. (RF)
Proceeds: $374.25
RF Analyst Estimates | MarketWatch
Profit Snapshot: +$191.53
Last Discussed: Item #1.B. Sold 2 RF at $22.13 (2/10/22 Post)(profit snapshot = $24.84)
Last Substantive Buy Discussion: Item # 3.C. Added 5 RF at $10.37; 5 at $9.3; 5 at $8; 5 at $7.5 (4/11/20 Post)
Dividend History: Quarterly at $.24 per share, last raised from $.20 effective for the 2023 4th quarter payment. The quarterly rate was $.38 per share in 2008 before being slashed to $.10 and then to $.01. My working assumption is that the dividend will be slashed again before it gets back to the $.38 quarterly rate again.
RF Realized Gains to Date: $517.16
C. Eliminated BHB - Sold 20 at $24.93:
Proceeds: $498.60
BHB Analyst Estimates | MarketWatch
Profit Snapshot: $169.35
Last Discussed: Item # 3. Pared BHB - Sold 10 at $31.4 (1/2/23 Post)
Dividend: Quarterly at $.28 per share, last raised from $.26 effective for the 2023 second quarter payment)
BHB Dividend History | Nasdaq (This data is unadjusted for 2 stocks splits that occurred in 2014 and 2017. I owned shares prior to each split)
Last Ex Dividend: 2/14/24
Last Earnings Report (Q/E 12/31/23): SEC Filed Press Release
Comparisons are to the 2022 4th quarter.
GAAP E.P.S. $.65, down from $.83
Non-GAAP E.P.S. = $.68, down from $.83
NIM = 3.17%, down from 3.76%
Efficiency ratio: 61.38%, up from 58.19%
The remaining numbers are good:
Charge off ratio: .07%
NPL Ratio: .18%, down from .23%
NPA Ratio: .14%
Tangible Book Value per share: $20.28; up from $17.78
Some Other Sell Discussions: Item # 3.E. Eliminated BHB in in Vanguard and Schwab Accounts - Sold 10 at $30.69 and 5 at $30.74 (12/20/22 Post)(profit snapshots = $66.33); Item # 4.D. Pared BHB in Fidelity Account - Sold 10 at $30 (12/6/22)(profit snapshot = $79.15); Item # 3.E. Pared BHB in Fidelity Account - Sold 2 at $31.5 (12/16/21 Post)(profit snapshot = $18.43); Item # 1.I. Pared BHB-Sold 10 at $28.5 and 5 at $30.5-highest cost lots in Fidelity Taxable Account (3/20/21 Post)(profit snapshot = $95.46): Item # 3.A. Pared BHB-Sold 40 at $24.48-highest cost lots in Fidelity taxable account (12/5/20 Post)(profit snapshot = $38.17); Item # 3.B. Eliminated BHB-Sold 54+ Shares at $26.34 (5/18/19 Post)(profit snapshot = $131.1); Item # 1.A. Sold 100 BHB at $30.69-Used Commission Free Trade (7/15/18 Post)(profit snapshot = $1,718.56) ; Item # 1.A. Sold 50 BHB at $30.02 (5/21/18 Post)(profit snapshot = $666.96); Item #3.A. Sold 100 BHB at $29.55 (4/26/18 Post)(profit snapshot = $682.94) ; Item # 1. A. Sold 30 BHB at $29.42 (3/25/18 Post)(profit snapshot = $41.02); Sold 100 BHB Update For Regional Bank Basket Strategy As Of 5/6/2016 - South Gent | Seeking Alpha (profit snapshot = $936.96)
D. Eliminated WBS - Sold 10 at $47.23:
Quote: Webster Financial Corp. (WBS)
Proceeds: $472.32
WBS Analyst Estimates | MarketWatch
Profit Snapshot: +$216.91
Last Discussed: Item # 1.H. Added to WBS - Bought 1 at $25.5; 1 at $25.08; 1 at $24.82; 1 at $24.6; 1 at $24.4 (10/17/20 Post); Item # 4.A. Restarted WBS-Bought 5 at $26.2 (8/29/20 Post)
Dividend: Quarterly at $.4 per share, last raised from $.33 effective for the 2019 first quarter.
Last Ex Dividend: 2/2/24
Last Earnings Report (Q/E 12/31/23): SEC Filed Press Release
Comparisons are to the 2022 4th quarter.
GAAP E.P.S. = $1.05, down from $1.38
Non-GAAP E.P.S. $1.46
Adjustments:
NIM: 3.42%, down from 3.74%
Efficiency Ratio: 43.04%, up from 40.27%
NPL Ratio: .41%, unchanged
Charge off Ratio: .27%, up from .17%
Coverage Ratio: 303.39% (allowance for credit losses to nonperforming loans)
Equity Preferred Stock: I see have a small ball position in a WBS equity preferred stock. WBS-PG; Item # 2.D. Added to WBSPRG - Bought 3 at $17.94 (5/13/23 Post); Item # 1.J. Added to WBSPRG - Bought 2 at $19.05 (4/1/2023 Post);Item # 5.E. Bought 5 WBSPRG at $22.8 (11/8/22 Post)
WBS SU Bonds: In my Vanguard account, I owned 2 Webster 4.375% SU bonds that matured on 2/15/24.
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Note that the "profit" of $45.66 was classified as a "market discount" which will be treated as interest income rather than a short term capital gain.
I also owned 2 of these bonds in my Fidelity Account.
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Item # 2.D. Bought 2 Webster 4.375% SU at a Total Cost of 99.114 (7/29/23 Post); Item # 3.C. Bought 2 Webster 4.375% SU at a TC of 97.717 (5/20/23 Post)(YTM at total cost then at 6.031%)
Prior Sell Discussion: Item # 1 Sold 50 WBS at $22.49 (5/4/2011 Post)(profit snapshot= $879.52)
WBS Realized Gains to Date: $1,096.43
E. Eliminated MBWM - Sold 22+ at $36.48:
Quote: Mercantile Bank Corp.
Proceeds: $802.57 (3/1/24 Sale only)
MBWM Analyst Estimates | MarketWatch
Profit Snapshot: $195.62 (3/1/24 Sale Only)
Last Discussed: Item # 2.H. Added to MBWM - Bought 2 at $28.75; 5 at $28.6 (4/22/23 Post)
Dividend: Quarterly at $.35 per share, last raised from $.34 effective for the 2024 first quarter payment.
MBWM Dividend History | Nasdaq
Last Ex Dividend: 2/29/24
Last Earnings Report (Q/E 12/31/23): SEC Filed Press Release
Comparisons are to the 2022 4th quarter.
E.P.S. $1.25, down from $1.37
NIM: 3.92%, down from 4.32%
Efficiency Ratio: 52.57%, up from 48.82%
NPL Ratio: .08%
Charge Off Ratio: Net recovery of .01
Tangible Book Value per share: $29.31, up from $24.47
This is one of the better reports. I am likely to buy back shares when and if the price sinks below the last reported tangible book value per share, assuming no intervening material adverse events.
F. Eliminated SBSI - Sold 25 at $30.3:
Quote: Southside Bancshares Inc. (SBSI)
Proceeds: $757.49
"Southside Bancshares, Inc. is a bank holding company with approximately $8.28 billion in assets as of December 31, 2023, that owns 100% of Southside Bank. Southside Bank currently has 55 branches in Texas."
SBSI Analyst Estimates | MarketWatch
Profit Snapshot: $106.15
Last Discussed: Item # 2.F. Added to SBSI - Bought 5 at $25.7 (7/15/23 Post); Item # 1.D. Added to SBSI - Bought 6 at $26.22 (7/8/23 Post)
Dividend: Quarterly at $.36 per share, last raised from $.35 effective for the 2024 first quarter payment.
Southside Bancshares, Inc. (SBSI) Dividend History | Seeking Alpha
Last Ex Dividend: 2/15/24
Last Earnings Report (Q/E 12/31/23):
Comparisons are to the 2022 4th quarter.
GAAP Diluted E.P.S. = $.57, down from $.87
GAAP Net income included a $10.386M loss from selling $388M in securities.
NIM: 2.99%, down from 3.4%
Efficiency Ratio: 50.86%, up from 46.38%
NPL Ratio: .09%
Charge off ratio: .11%
Tangible Book value per share: $18.82, up from $17.13
Other Sell Discussions: Item # 1.D. Sold 1 SBSI at $39.8 (4/1/2021 Post); Item # 2 Sold 100 SBSI at $21.53 (6/28/12 Post); Item # 2.B. Sold 50 SBSI at $21.27 (4/29/13 Post); Item # 3 Sold 107+ SBSI at $20.5 (7/18/11 Post)
SBSI Realized Gains to Date: $534.99
G. Eliminated PFC - Sold 10 at $20.21:
Quote: Premier Financial Corp.
Proceeds: $202.1
"Premier Financial Corp. (Nasdaq: PFC), headquartered in Defiance, Ohio, is the holding company for Premier Bank. Premier Bank, headquartered in Youngstown, Ohio, operates 75 branches and 9 loan offices in Ohio, Michigan, Indiana and Pennsylvania."
Profit Snapshot: $57.85
Last Discussed: Item # 2.D. Added to PFC - Bought 5 at $13.9 (5/27/23 Post); Item # 3.C. Restarted PFC - Bought 5 at $14.95 (5/13/23 Post)
Dividend: Quarterly at $.31 per share, last raised from $.30 effective for the 2022 4th quarter payment.
Last Ex Dividend: 2/8/24
Last Earnings Report (Q/E 12/31/23): SEC Filed Press Release
Comparisons are to the 2022 4th quarter.
E.P.S. = $.56, down from $.71
NIM = 2.65%, down from 3.28%
Efficiency Ratio: 59.48%, up from 56.76%
NPA Ratio: .41%, unchanged
Charge off ratio: .13%; up from .05%
Coverage ratio: 215.58%
Tangible Book Value per share: $18.69, up from $15.47
Last Sell Discussion: Item # 3.K. Eliminated PFC - Sold 10 at $22.22 (1/1/21 Post)
H. Eliminated CFG - Sold 33+ at $33.37:
Quote: Citizens Financial Group Inc. (CFG)
Proceeds: $1,120.85
CFG Analyst Estimates | MarketWatch
Profit Snapshot: Net of +$72.42
Last Discussed: Item # 1.E. Eliminated Duplicate CFG Position - Sold 10+ at $31.58 (1/20/24 Post)(profit snapshot = $86.79) I discussed the last earnings report in that post. SEC Filed Press Release and SEC Filed Supplemental for the 2023 4th Quarter
Last Buy Discussions: Item # 1.P. Added 1 CFG at $24.65 (5/20/23 Post); Item # 1.G. Added to CFG - Bought 1 at $30.23; 2 at $29.7; 5 at $28.9;2 at $28.54 (4/8/23 Post)
CFG SU Bonds: I currently own 2 Citizens Financial 4.3% SU bonds that mature on 12/3/25. Bond Page | FINRA.org
CFG Preferred Stock: I currently own 10 shares of this fixed-to-floating rate equity preferred Stock. Final Prospectus Supplement (fixed at 6.35% to but excluding 4/6/24; then at a 3.642% + the tenor spread of .21161% spread to the 3 month SOFR, with optional redemption at the $25 par value + accrued and unpaid dividend. Citizens Financial Group Inc. Preferred Series D Stock; Item # 1.A. Added to CFGPRD - Bought 3 at $22.61 (7/8/23 Post); Item # 2.A. Added to CFGPRD at $21.65 (6/10/23 Post)Item # 3.D. Eliminated Duplicate Position in CFGPRD - Sold 10 at $24.56 (12/16/2023 Post); Citizens Financial Group, Inc. Announces Transition of U.S. LIBOR-linked Preferred Stock to Term SOFR Replacement Rate; Definition: tenor spread adjustment from 12 USC § 5802(20) I am expecting that this preferred stock will be called on 4/6/24.
I. Eliminated AGR - Sold 15+ at $36.22:
Quote: Avangrid Inc. - Utility Holding Company
AGR Analyst Estimates | MarketWatch
Profit Snapshot: +$77.22
I discuss buying 2 more AGR bonds in Item # 3.C. below.
Dividend: Quarterly at $.44 per share ($1.76 annually), last increased from $.432 effective for the 2018 third quarter payment.
AGR Dividend History | Seeking Alpha
Last Ex Dividend: 2/29/24 (owned all as of)
Last Discussed: Item # 1.E. Added to AGR - Bought 1 at $30.77; 1 at $30.22; 1 at $29.5; 2 at $29.1; 1 at $28.62; 1 at $28.27; 1 at $27.7 (10/7/23 Post)
3. Corporate Bonds:
A. Bought 2 MPLX LP 4% SU Maturing on 2/15/25 at a Total Cost of 98.586:
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FINRA Page: Bond Page | FINRA.org
Credit Ratings: Baa2/BBB
YTM at Total Cost: 5.554%
Current Yield at TC = 4.0574%
B. Bought 2 Becton, Dickenson 3.734% SU Maturing on 12/15/24 at a Total Cost of 98.69:
Issuer: Becton Dickinson & Co. (BDX)
BDX Analyst Estimates | MarketWatch
FINRA Page: Bond Page | FINRA.org
Credit Ratings: Baa2/BBB
YTM at Total Cost: 5.445%
Current Yield at TC = 3.78%
C. Bought 2 Avangrid 3.15% SU Maturing on 12/1/24 at a Total Cost of $98.3:
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Issuer: Avangrid Inc. (AGR) - Utility Holding Company
I have a small ball position in the common stock.
AGR Analyst Estimates | MarketWatch
AGR SEC Filed Earnings Press Release for the Q/E 12/31/23
FINRA Page: Bond Page | FINRA.org
Credit Ratings: Baa2/BBB
YTM at Total Cost: 5.53%
Current Yield at TC = 3.2%
D. Bought 2 Omnicom Group 3.65% SU Maturing on 1/1/24 at a Total Cost of 98.825 - Fidelity Account:
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Issuer: Omnicom Group Inc. (OMS)
OMC Analyst Estimates | MarketWatch
SEC Filed Earnings Press Release for the Q/E 12/31/23
Finra Page: Bond Page | FINRA.org
Credit Ratings: Baa1/BBB+
YTM at Total Cost: 5.507%
Current Yield at Total Cost: 3.693%
Last Bond Offering (2/2024): Prospectus for €600M 3.7% SU Maturing in 2032.
E. Bought 2 Omnicom 3.65% SU Maturing on 11/1/24 at a Total Cost of 98.777 (Interactive Brokers account):
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YTM at Total Cost: 5.5754%
See Item # 3.D. Above.
I now own 4 bonds.
F. Bought 2 Oracle 2.95% SU Bonds Maturing on 11/15/24 at a Total Cost of 98.28:
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Issuer: Oracle Corp. (ORCL)
ORCL Analyst Estimates | MarketWatch
SEC Filed Earnings Press Release for the Q/E 11/30/23
Finra Page: Bond Page | FINRA.org
Credit Ratings: Baa2/BBB
YTM at Total Cost: 5.51%
Current Yield at Total Cost: 3%
I now own 4 bonds.
I own 4 Oracle 3.4% SU bonds that mature on 7/8/24.
Last Bond Offering (2/23): Prospectus
4. Treasuries Purchased at Auction:
A. Bought 5 Treasury Bills at the 3/4/24 Auction:
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Matures on 9/5/24
Interest: $129.04
Investment Rate: 5.313%
B. Bought 5 Treasury Bills at the 3/4/24 Auction:
91 Day Bill
Matures on 6/6/24
Interest: $66.23
Investment Rate: 5.384%
C. Bought 5 Treasury Bills at the 3/7/24 Auction:
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5. Equity Preferred Stocks:
A. Restarted EPRPRC - Bought 10 at $19.31:
Quote: EPR Properties 5.75% Cumulative Convertible Preferred Series C Stock
Cost $193.1
Issuer: EPR Properties (EPR)
Investment Category: Advantages and Disadvantages of Equity REIT Cumulative Equity Preferred Stocks, part of the Equity REIT Common and Preferred Stock Basket Strategy
My main concern about this preferred stock has been the credit risk. The credit risk involves owning theatre properties leased to companies that went bankrupt during the pandemic. One of those tenants, Regal Cinemas, has emerged from bankruptcy with new lease agreements signed covering 41 of the 57 properties. A few others are vacant and will have to sold or released. 2023 Annual Report at pages 41-42
After reviewing the last earnings report, I become comfortable enough to restart a position with a 10 share purchase.
SEC Filed Press Release for the Q/E 12/31/23 and Supplemental:
Last EPR.PRC Discussion: Item # 5.B. Eliminated EPR.PRC - Sold 21 at $20.78 (1/20/24 Post)(profit snapshot: net of $26.54)
Preferred Stock Prospectus
Placement in the Capital Structure: Equity Preferred Stock, senior only to common stock.
Par Value: $25
Coupon: 5.75%
Dividends: Paid Quarterly, Non-Qualified and Cumulative
Yield at $19.31 = 7.44%
Next Ex Dividend: 3/27/24
Conversion into Common Stock: The conversion feature is currently assigned no value, or close to it, based on the preferred stock price.
That has not always been the case as shown by some price levels before the pandemic, including those of some of my prior sales. The current conversion price is at $58.8 as of 12/31/23: Summary of Series C Preferred-Shares.pdf At some point, the conversion feature may start to positively impact the share price, as it has in the past, but it is difficult to foresee that happening anytime soon given the troubles of major tenants in the movie theater business.
The conversion price started at $71.34 and has drifted down as determined by a complex formula. One component of that formula is the amount that common share quarterly dividend exceeds $.685 per share.
Dividends | EPR Properties The last monthly dividend was $.275 per share or $.825 per quarter. The next monthly dividend payment will be $.285 per share, with the increased announced in EPR's earnings press release for the Q/E 12/31/23.
Other Sell Discussions:
Item # 4.B. Sold 10 ERPPRC at $20.32 (7/3/2020 Post)(profit snapshot = $76.66);
Item # 3.B. Sold 10 EPRPRC at $17.5 and 5 at $16.22 (5/2/20 Post)(profit snapshot = $16.6)
Item # 3 Sold 50 EPRPRC at $27.49 (10/21/18 Post)(profit snapshot = $178.58)-Item # 1 Bought 50 EPRPRC at $23.78-Used Commission Free Trade (4/23/18 Post)
Item # 1.B. Sold 50 EPRPRC at $28.48 (9/12/18 Post)(profit snapshot = $224.22)-Item # 1 Bought 50 EPRPRC at $24 (4/23/18)
Item # 3 Sold 50 EPRPRC-Update For Equity REIT Basket Strategy As Of 4/6/16 - South Gent | Seeking Alpha (profit snapshot = $160.48)
ERPPRC Trading Profits to Date: $683.08
B. Added 5 NSAPRA at $22.56:
Quote: NSA-PA
Cost: $112.8
Issuer: National Storage Affiliates Trust (NSA) - Internally Managed Storage REIT
I have a small ball position in the common stock.
Investment Category: Advantages and Disadvantages of Equity REIT Cumulative Equity Preferred Stocks
Last Discussed: Item # 2.C. Bought 10 NSAPRA at $23.15 (2/9/24 Post)
New Average cost per share: $22.93 (15 shares)
REIT Equity Preferred Stock
Par Value: $25
Coupon: 6%
Dividends: Paid quarterly and cumulative.
Yield at $22.93: 6.54%
Next Ex Dividend: 3/14/23
Optional Call: At par value + accrued and unpaid dividend on or after 10/11/22.
Maturity: None, potentially perpetual
Stopper Clause: Standard
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.
