WCC - WCC-A: YTC Says Holding Okay Adding A No Thanks

2024-02-09 07:30:00 ET

Summary

• When deciding on adding a fixed-income asset with Call dates, I like to compare the YTC against what I could get with a safe CD of the same maturity time.
• Here I review the WESCO PFD A and compare its YTC against not only a similar CD, but three different preferred all callable about the same time.
• I treat the WESCO International, Inc. DP SH FXRT PFD A as a CD since it's probably of being Called is very high, if not almost certain, to happen.
• With the current YTC slightly above 18-month CDs, it rates a Hold for those okay with the 5% YTC, a Sell for others wanting more return and willing to take on more risk.

Introduction

Last fall, I took advantage of longer-dated CDs to lock in 5.25+% rates out to 2028. Today, rates longer than 2 years are near or below 4%. For better choices, but with more risk and not a guaranteed return, I covered two High-Yield ETFs with set termination dates and more importantly, all holdings maturing beforehand. Those were:

• IBHD: Skip The 1-Yr CD, Own This Term ETF Instead
• IBHF Or 3-YR CD: I've Decided Which Is Better

For further details see: