Morgan Stanley started covering Seaspan Corp yesterday and they started off with an Underweight rating and a $4.50 price target: http://ift.tt/2kX4gPU
Seaspan Corp (SSW) is down ~30% since 1/30 close, pretty much entirely because of the MS coverage and the realization that SSW's common dividend is going to fall, likely hard, from $1.50/year. If you love chasing yield like a sucker, you will surely enjoy the current 22% dividend yield.
Meanwhile, because of the hit to the stock, SSW's exchange traded unsecured 6.375% 4/30/2019 notes (SSWN) fell to a low of $23.50 today from a close of $24.75 yesterday. That is a change in yield to maturity from 6.91% to 9.44% overnight. So I picked up some shares at $23.70 when I realized what was going on for a YTM of 9.03%. An hour later, SSWN is already back to $24.43, 7.55% yield. I'm up 3% on a bond in one hour, and yet people here continue to scream about how bonds are useless and you'd be lucky to make 3% in a year.
Submitted February 02, 2017 at 11:06AM by hydrocyanide http://ift.tt/2kwxhoA
