PIMCO CA Municipal Income Stock Price, News & Analysis

PIMCO California Municipal Income Fund (PCQ) is a closed-end management investment company that trades its common shares on the New York Stock Exchange under the symbol PCQ. According to its disclosures, the fund’s primary objective is to provide current income that is exempt from federal and California state income taxes by investing in municipal securities.

The fund is organized as a Massachusetts entity and is part of a family of municipal income funds that includes PIMCO Municipal Income Fund II and PIMCO New York Municipal Income Fund II, as referenced in joint proxy materials. Pacific Investment Management Company LLC (PIMCO) serves as the investment manager to the fund, and the principal executive offices for the funds are located in New York, New York.

Investment focus and tax-exempt strategy

The PIMCO California Municipal Income Fund invests primarily in municipal bonds that pay interest which, in the opinion of bond counsel to the issuer or based on other authority the manager considers reliable, is exempt from California income taxes and from federal income taxes. These securities are referred to in the fund’s filings as California Municipal Bonds when they are exempt from California income taxes.

The fund has a fundamental policy to, under normal circumstances, invest at least 80% of its assets, as that term is defined in Rule 35d-1 under the Investment Company Act of 1940, in investments whose income is, in the opinion of bond counsel or other acceptable authority, exempt from both federal and California state income taxes. This policy is designed to support the fund’s goal of providing tax-advantaged income to shareholders subject to those tax regimes.

Non-fundamental investment guidelines

In an 8-K filing, the fund reported that its Board of Trustees approved a change to a non-fundamental investment guideline related to California Municipal Bonds. The minimum investment guideline for California Municipal Bonds was reduced from 90% to 80% of the fund’s net assets. Effective as of a stated date in that filing, the fund invests, under normal circumstances, at least 80% of its net assets in municipal bonds whose interest is exempt from California income taxes, while continuing to follow its fundamental 80% assets policy for income exempt from both federal and California state income taxes.

This change affects the fund’s non-fundamental guidelines but does not alter its stated fundamental policy regarding tax-exempt income. The adjustment is described in the fund’s SEC reports and is expected to be reflected in shareholder reports on Form N-CSR for the relevant reporting period.

Closed-end fund structure and share classes

The PIMCO California Municipal Income Fund operates as a closed-end fund, which means it has a fixed number of shares that trade on an exchange rather than issuing and redeeming shares on a continuous basis. According to proxy materials, the fund has common shares and preferred shares outstanding. Common shareholders and preferred shareholders generally vote together as a single class on certain matters, while preferred shareholders may vote separately on specific trustee elections related to preferred share representation.

The fund’s proxy statement describes common shareholders as “Common Shareholders” and preferred shareholders as “Preferred Shareholders,” which include Remarketable Variable Rate Municipal Term Preferred Shares (RVMTPS). The classes of shares listed in the proxy materials are the only classes currently issued by the fund.

Governance and shareholder meetings

The fund is overseen by a Board of Trustees. Proxy statements describe a Joint Annual Meeting of Shareholders for PIMCO California Municipal Income Fund and related funds, where shareholders vote on the election or re-election of trustees and any other business that may properly come before the meeting. The record date for such meetings is set by the Board, and shareholders of record on that date are entitled to notice of, and to vote at, the meeting.

Common and preferred shareholders of the fund may have different voting rights depending on the proposal. For example, certain independent trustees or nominees may be elected by common and preferred shareholders voting together, while other trustees designated as preferred shares trustees may be elected exclusively by preferred shareholders voting as a separate class.

Management and administration

PIMCO serves as the investment manager to the PIMCO California Municipal Income Fund. The proxy statement notes that additional information regarding the manager is provided in sections labeled “Additional Information — Investment Manager.” The costs of soliciting proxies for shareholder meetings are borne by PIMCO, and certain officers and employees of the manager or its affiliates may participate in proxy solicitations without additional compensation.

The fund’s principal executive offices are identified in SEC filings as being located in New York, New York. Contact information and additional details about reports to shareholders are provided in the fund’s regulatory documents, which also indicate that annual and semi-annual reports are available upon request.

Portfolio sectors and diversification

According to the Polygon description, the PIMCO California Municipal Income Fund makes investments in different sectors such as healthcare, property, education, natural gas, and other areas within the municipal bond market. These sector references indicate that the fund’s municipal bond holdings can span multiple types of public-purpose or revenue-backed projects, while still aligning with its tax-exempt income objectives.

Because it is a municipal income fund focused on California-related tax-exempt securities, the fund’s holdings and sector allocations are subject to the guidelines and policies described in its SEC filings and shareholder reports, including the requirement that a substantial portion of assets generate income exempt from federal and California state income taxes.

Use cases for investors

The PIMCO California Municipal Income Fund is structured for investors seeking exposure to municipal bonds with income that is exempt from federal and California state income taxes, as described in its filings. As a closed-end fund listed on the New York Stock Exchange, its shares can be bought and sold on the secondary market under the symbol PCQ, and its structure includes both common and preferred share classes with defined voting rights outlined in proxy statements.