Investors' opinions diverge over how the $340 million Miami-Dade County Expressway Authority's toll system refunding revenue bonds scheduled to price Wednesday will be received by the market.
Miami-Dade county is a strong name and the bonds earned high ratings, but many market participants have enough Miami-Dade County bonds in their portfolios, investors said.
"Miami, I think people are fine with the name, but most issuances in Florida come out of Miami, investors may be a little oversaturated," a trader in Florida said.
Morgan Stanley is scheduled to price the bonds, and the issuance received an A3 from Moody's Investors Service, and an A-minus from Standard & Poor's and Fitch Ratings.
Miami-Dade county recently issued $208 million bonds in variable rate mode in May to lower borrowing costs for its Port Miami capital plan. The county also is scheduled to competitively price $101 million 30-year general obligation bonds in July.
The Bond Buyer reported that the Expressway Authority's last deal totaling over $100 million was in March 2013, when the Expressway Authority issued $270.3 million toll system revenue refunding bonds.
"A lot of paper coming out of Florida is from around that Miami-Dade area," a trader in Virginia said. "Guys could be a little bit oversaturated, a little bit heavy in Miami-Dade. That puts a little bit of pressure on the deal.
A trader in New York said that he expects the deal to go well because investors received cash from bonds they were holding maturing, or cash from the bonds’ coupon payments on June 1.
"Morgan Stanley is running that Miami-Dade deal, we are going to see some good interest in that," he said.
Los Angeles County plans to sell $900 million in tax and revenue anticipation notes Wednesday, the largest deal of the week. The deal is rated MIG1 by Moody's Investor Service, SP-1+ by Standard & Poor's and F1+ by Fitch Ratings.
The largest long term bond pricing scheduled for this week is a $431.2 million sale of Regional Transportation District of Colorado certificates of participation. JP Morgan Securities is the lead underwriter and the deal is rated Aa3 by Moody's, and A by both S&P and Fitch.
Piper Jaffray will bring $290 million of Phoenix, AZ GO refunding bonds. The deal received an Aa1 rating from Moody's and AA-plus from S&P.
JP Morgan Securities will issue $250 million of taxable Texas Public Finance Authority revenue bonds. The deal is rated Aaa by Moody's and AAA by Fitch.
BMO Capital Markets will bring $186.5 million of tax-exempt Wyandotte County, Unified Government revenue bonds. The deal received an A-plus rating from both S&P and Fitch.
Citigroup Global Markets will issue $145.4 million of Phoenix Union High School District improvement and refunding bonds. The deal is rated Aa2 by Moody's and AA by S&P.
In the competitive market, Columbus, Ohio, is expected to sell $258.3 million on Wednesday. The deal is rated AAA by all three rating agencies.
Municipal bond yield continued to rise on Wednesday with bonds maturing in four-to 10-years increasing from one to three basis points, jumping up to two basis points for 11-to 16-years, and from one to three basis points for 17-to 30-years.
Treasuries were mostly steady Wednesday morning, with the 10-year benchmark and the two-year note remaining at 2.60% and 0.40%, respectively, from Tuesday's market close. The 30-year yields inched up one basis point to 3.44%.
