I think I could see it. its all about leverage. By issuing PFD's and being able to leverage the proceeds you are cementing a long term cost of borrowing and buying what are likley to be long term obligations. I would expect a spread. that spreads income would be distributed to current (undiluted) shareholders. So you increase cash flow to current owners. Now the question would be why do you want to buy the PFD's? Again I would guess a stable income and maybe security when these things all "deleverage".
You might redeem these things if your leverage is working against you or the bonds you bot are being called and the current PFD rate is to high.
It would seem AGNC should issue all the preferreds that it can at 8%, And pay dividends on he common at about 16%, forever and ever. So.....will they never do another secondary? Gotta admit, I'm confused. If they can raise preferred capital at 8%, why did hey do a secondary one month ago, when the new secondary shares pay the normal 16% yield? Of course preferred capital at 8% makes more sense than common shares which pay about 16%, so why ever do a common secondary ever again?
the PFD is an obligation to pay. shareholders "go with the flow". When the leverage works against you those PFD's need to go pronto. Dont know if capital structure would play as well, but wouldnt be surprised. Finally you need interest in your securities. perhaps selling more shares is pissing off your current shareholders, but spreads are still there so you want more money. I question what the security is for the PFD players, especally when these things implode, so that to might limit how much of this stuff they can float. For the time being full steam ahead..............
Just bought shares in PDS as a two year value play. 2013 earnings are estimated at $1.60. Company is reinventing itself as more focused as a oil service company as opposed to ng. 50% gain very possible IMHO.