Be Quick To Buy This Rare Over 7% Yielding Liberty Broadband Preferred

Group 1: Liberty Broadband Overview - Liberty Broadband is part of a portfolio of companies focused on Telecoms and Media, controlled by John Malone and associates, which includes Liberty Latin America, Liberty Tripadvisor Holdings, and Charter Communications [3][4] - The company aims to provide shareholder returns primarily through capital gains rather than dividends, making its preferred stock a rare fixed income security within the Liberty family [3][4] - Liberty Broadband has a significant stake in Charter Communications, which is crucial for generating cash to pay dividends on its preferred stock [4][5] Group 2: Relationship with Charter Communications - Liberty Broadband was formed in 2020 through a stock-for-stock merger with GCI Liberty, resulting in a simplified structure with a 26% stake in Charter Communications [4][5] - The preferred stock of Liberty Broadband was initially issued by GCI Liberty and has now been integrated into Liberty Broadband's balance sheet, enhancing its safety [5][6] - Liberty Broadband generates cash by selling shares of Charter back to the company, maintaining its 26% ownership while receiving funds to cover dividends and other expenses [5][6] Group 3: Stock Classes and Characteristics - Liberty Broadband has multiple classes of stock, including A, B, C, and preferred stock, allowing for uneven distribution of voting power among executives [6][7] - As of year-end 2023, there are approximately 7.2 million preferred shares outstanding, with an annual dividend payment totaling about $12.6 million [5][8] - The preferred stock is currently trading below par at $23.80, with a yield of 7.35%, and has a mandatory redemption feature at par on March 8, 2039 [10][11] Group 4: Investment Thesis - The Liberty Broadband preferred stock is characterized by its safety, high yield, and mandatory redemption, making it an attractive investment option for those seeking fixed income in the telecom sector [9][11] - The company’s total interest payments, including those on preferred stock, were just over $200 million in 2023, which is manageable given the cash inflow from Charter Communications [10][11] - Investors are encouraged to consider purchasing the preferred stock soon, as anticipated interest rate cuts may increase its price above par [11]