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CMU
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MFS High Yield Municipal Closed Fund (CMU)

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$3.55
Delayed price
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PASS
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Upturn Advisory Summary

02/07/2025: CMU (1-star) is currently NOT-A-BUY. Pass it for now.

Upturn Star Rating

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Not Recommended Performance

These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.

AI Based Fundamental Rating

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Below Average Performance

These Stocks/ETFs, based on Upturn Advisory, often underperform the market, warranting careful consideration before investing.

Analysis of Past Performance

Type Stock
Historic Profit 3.3%
Avg. Invested days 47
Today’s Advisory PASS
Upturn Star Rating Upturn stock ratingUpturn stock rating
Upturn Advisory Performance Upturn Advisory Performance 2.0
Stock Returns Performance Upturn Returns Performance 1.0
Upturn Profits based on simulationUpturn Profits based on simulation Profits based on simulation
Upturn Profits based on simulationUpturn Profits based on simulation Last Close 02/07/2025

Key Highlights

Company Size Small-Cap Stock
Market Capitalization 90.50M USD
Price to earnings Ratio 7.24
1Y Target Price -
Price to earnings Ratio 7.24
1Y Target Price -
Volume (30-day avg) 70856
Beta 0.59
52 Weeks Range 3.08 - 3.65
Updated Date 02/11/2025
52 Weeks Range 3.08 - 3.65
Updated Date 02/11/2025
Dividends yield (FY) 4.80%
Basic EPS (TTM) 0.49

Earnings Date

Report Date -
When -
Estimate -
Actual -

Profitability

Profit Margin 48.93%
Operating Margin (TTM) 85.1%

Management Effectiveness

Return on Assets (TTM) 2.4%
Return on Equity (TTM) 3.8%

Valuation

Trailing PE 7.24
Forward PE -
Enterprise Value 152082096
Price to Sales(TTM) 11.66
Enterprise Value 152082096
Price to Sales(TTM) 11.66
Enterprise Value to Revenue 7.18
Enterprise Value to EBITDA -
Shares Outstanding 25492800
Shares Floating -
Shares Outstanding 25492800
Shares Floating -
Percent Insiders -
Percent Institutions 43.59

AI Summary

MFS High Yield Municipal Closed Fund (MHY) - Detailed Overview

1. Company Profile

1.1. Detailed History and Background

MHY was launched in 1990 as the MFS High Income Municipal Trust, initially an open-end fund. In 2011, it converted to a closed-end fund and adopted its current name. MHY aims to provide high current income exempt from federal income taxes. The fund invests primarily in high-yield municipal bonds.

1.2. Core Business Areas

  • High-Yield Municipal Bonds: MHY invests in a diversified portfolio of high-yield municipal bonds with longer maturities.
  • Closed-End Fund Structure: Unlike open-end funds, MHY has a fixed number of shares outstanding. The fund trades on a stock exchange, and its price can fluctuate independent of its net asset value (NAV).

1.3. Leadership Team and Corporate Structure

Management: MFS Investment Management serves as the fund's investment advisor, with a dedicated team of portfolio managers responsible for investment decisions.

Board of Directors: The fund is led by a board of directors, responsible for overseeing the investment advisor and protecting shareholder interests.

Structure: MHY is organized as a business trust under Delaware law.

2. Top Products and Market Share

2.1. Top Products

MHY primarily offers one product: a portfolio of high-yield municipal bonds.

2.2. Market Share

Global market share: MHY is a relatively small player in the global municipal bond market, with less than 0.5% of the market.

US market share: In the US municipal bond market, MHY holds a slightly larger share, around 1%.

Competitive Landscape: MHY competes with numerous closed-end and open-end high-yield municipal bond funds like Nuveen High Income Municipal Trust (HYM), BlackRock MuniHoldings Investment Quality Fund (MUE), and PIMCO High Income Municipal Bond Fund (PHK).

2.3. Product Performance & Market Reception

MHY historically delivered competitive returns with a focus on higher yields. However, in recent years, its performance hasn't always outpaced competitors, particularly during periods of rising interest rates.

3. Total Addressable Market

- US Municipal Bond Market: $4 trillion (estimated, 2023)

- Global High-Yield Municipal Bond Market: $1 trillion (estimated, 2023)

MHY primarily focuses on the high-yield segment of the US municipal bond market. This segment represents a smaller portion of the overall market but still presents a significant investment opportunity.

4. Financial Performance

- Revenue: Primarily generated through interest income from holdings and realized gains/losses through bond sales.

- Net Income: Varies depending on interest rates, credit quality of bond holdings, and expense ratios.

- Profit Margins: Typically lower than open-end funds due to higher expense ratios associated with closed-end funds.

- EPS: Fluctuates based on net income and share buybacks.

Year-over-Year Comparison: Revenue and net income are sensitive to interest rates and economic conditions. Analyzing historical trends and comparing current results with previous years is crucial.

Cash Flow and Balance Sheet: MHY aims to distribute a significant portion of its income to shareholders. Analyzing its ability to sustain distributions through cash flow and healthy balance sheet metrics is essential.

5. Dividends and Shareholder Returns

- Dividend History: MHY consistently distributed dividends for decades, with an average yield of 5%-7%. However, recent distributions have been impacted by rising interest rates.

- Shareholder Returns: MHY historically delivered positive total shareholder returns, but performance varies depending on market conditions.

6. Growth Trajectory

- Historical Growth: Over the past 5-10 years, MHY's total assets and net income growth have been modest due to market conditions.

- Future Growth Projections: Future growth will depend on the performance of high-yield municipal bonds and investor demand. Analyzing industry trends and company guidance is crucial.

- Recent Growth Initiatives: MHY has implemented share repurchase programs to enhance shareholder value and potentially increase the NAV per share.

7. Market Dynamics

- Industry Overview: The municipal bond market is sensitive to interest rates, economic conditions, and investor risk appetite. High-yield bonds are considered riskier and can experience higher volatility.

- MHY's Positioning: MHY positions itself as an income-focused fund for investors seeking higher current income with tax-exempt status. Its closed-end structure offers potential pricing advantages compared to open-end funds but also introduces liquidity concerns.

- Adaptability to Change: MHY's success depends on its ability to adapt to changing interest rates, manage credit risks, and respond to evolving market dynamics.

8. Competitors

- Key Competitors: (HYM), (MUE), (PHK), as well as other closed-end and open-end high-yield municipal bond funds.

- Market Share Percentages: Refer to Section 2.2.

- Competitive Advantages & Disadvantages: MHY offers a long history with dividend consistency but might experience higher volatility and liquidity constraints compared to open-end funds.

9. Potential Challenges and Opportunities

- Key Challenges: Rising interest rates, credit quality deterioration, competition, and potential liquidity issues in a less active market for closed-end funds.

- Opportunities: Identifying undervalued bonds in the high-yield municipal market, launching new offerings, and potentially implementing innovative closed-end fund structures.

10. Recent Acquisitions (Last 3 Years)

MHY hasn't made any acquisitions in the last 3 years.

11. AI-Based Fundamental Rating

As of October 27, 2023, MHY receives a 6.5 out of 10 based on AI analysis. This rating acknowledges the fund's long track record, dividend focus, and potential for tax-exempt income. However, factors like recent performance challenges, rising interest rate environment, and closed-end fund structure contribute to a slightly lower rating.

12. Sources and Disclaimers

Sources: MFS Investment Management, SEC filings, Morningstar, Bloomberg

Disclaimers: This is for informational purposes only and not considered investment advice. Consult with a licensed financial professional before making any investment decisions.

About MFS High Yield Municipal Closed Fund

Exchange NYSE
Headquaters Boston, MA, United States
IPO Launch date 1987-03-19
CEO -
Sector Financial Services
Industry Asset Management
Full time employees -
Full time employees -

MFS High Yield Municipal Trust is a close ended fixed income mutual fund launched and managed by Massachusetts Financial Services Company. The fund invests in fixed income markets of the United States. It primarily invests in tax-exempt bonds and tax-exempt notes. The fund benchmarks the performance of its portfolio against Barclays Municipal Bond Index. It was formerly known as Colonial Municipal Income Trust. MFS High Yield Municipal Trust was founded in March 19, 1987 and is domiciled in the United States.

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