PIMCO CEF Update: The Hammer Comes Down On RCS And PCM

2025-01-23 09:25:00 ET

Summary

• PIMCO delivered two big distribution cuts for RCS and PCM.
• Key factors influencing distribution sustainability include borrowings, leverage, NAV distribution rates, and fees, with NAV distribution rate being the most critical.
• PDI, despite being in the danger zone, avoided cuts likely due to its flagship status, though its NAV has declined and will likely keep declining.
• Venture Global's IPO is a positive for PDX as its distribution was hiked and the price rallied on the news of the IPO size.

In this article we provide another update of the PIMCO CEF suite. Say what you will but PIMCO CEFs never have a dull moment. In our last update we discussed how Muni CEF coverage levels were shredded with PIMCO restating previous coverage levels from an average of 123% to an average of 82% (by restating we actually mean changing previously published numbers in their spreadsheets)....

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