
North American Bond Research – April 3, 2020
Posted on April 3, 2020
HIGH YIELD BOND RESEARCH
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April 3, 2020
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Key Gainers and Losers | Volume Leaders | ||||||||||||||||||||||||||||||
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General Motors Co. 6.25% 10/2/2043 Hilton Worldwide Finance LLC 4.875% 4/1/2027 Ally Financial Inc. 4.125% 2/13/2022 Expedia Inc. 5.95% 8/15/2020 HCA Inc. 3.5% 9/1/2030 Western Gas Partners LP 5.3% 3/1/2048 Intl Lease Finance Corp. 8.25% 12/15/2020 General Motors Co. 4.875% 10/2/2023 SLM Corp. (USD) 5.5% 1/25/2023 Whiting Petroleum Corp. 6.625% 1/15/2026 |
Industry Returns Tracker | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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New Issues | Forward Calendar |
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1. Tenet Healthcare Corp. (USD) 7.5% 4/1/2025 144A (04/02/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 7.5%.
2. Tenet Healthcare Corp. (USD) 7.5% 4/1/2025 Reg S (04/02/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 7.5%. 3. NEW Red Finance, Inc. (USD) 5.75% 4/15/2025 144A (04/02/2020): 500MM First Lien Notes, Price at Issuance 100, Yielding 5.75%. 4. NEW Red Finance, Inc. (USD) 5.75% 4/15/2025 Reg S (04/02/2020): 500MM First Lien Notes, Price at Issuance 100, Yielding 5.75%. |
1. AVI-SPL: $370MM covenant lite TLB (B2/B)
2. Service Logic: $140MM bank debt: $40MM TL; $100MM DD TL 3. CJ Foods Inc.: $285MM TLB 4. Cornerstone Ondemand Inc.: $1.135MM senior secured credit facilities: $150MM revolver; $985MM TLB 5. Eldorado Resorts Inc./Caesars Entertainment Corp.: $6.4B credit facilities:$1B revolver at Eldorados; $3B seven-year cove-lite TLB due 2027 at Eldorado; $2.4B seven-year cove-lite TLB due 2027 at Caesars Resorts Collection 6. Innovate Xcessories & Services LLC: $695MM credit facilities: $75MM revolver; $620MM TL(B2/B) 7. Instructure: $825MM senior secured credit facilities: $50MM revolver; $775MM TL 8. RSA: $1.425B credit facilities: $75MM revolver; $1B TL; $350MM TL 9. Snapav: $390MM term loans: $290MM TL (B2); $100MM TL 10. Tata Chemicals North America Inc. : $380MM TL (Ba3) |
Top Widening Loans | Top Narrowing Loans |
J Crew Group Inc. (USD) TLB L+322 03/06/2021 Arvos Holding (EUR) TLB2 E+450 08/29/2021 Advantage Sales & Marketing Inc. (USD) TL2 L+650 07/25/2022 Tipico Co. LTD (EUR) TLB E+350 08/08/2022 Quest Software US Holdings Inc (USD) TL L+425 05/17/2025 |
Booz Allen Hamilton Inc. (USD) TL L+175 11/22/2026 Concordia International (EUR) TL E+525 09/06/2024 Hamilton Holdco LLC (USD) TLB L+200 01/02/2027 Prosol Gestion (EUR) TLB E+400 04/21/2024 ATI Holdings (USD) TLB L+350 05/10/2023 |
SYNDICATED LOANS HIGHLIGHTS:
Deals recently freed for secondary trading, notable secondary activity:
- Symantec Corp., Broadcom LTD, Toll Brothers Inc., Cole-Parmer Instrument Co.
OVERALL CREDIT MARKET:
Long-term bond yields are expected to hit a cyclical peak in 2019 given tight fiscal policy and lagging global economies. Europe remains checked by stubbornly low inflationary forces. Positive effects remained in force:
- TED spread held below 130 bp (basis points), as of 04/3/2020
- Net negative capital flows into high-yield ETFs & mutual funds
INVESTMENT GRADE BOND RESEARCH
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April 3, 2020
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Key Gainers and Losers | Volume Leaders | ||||||||||||||||||||||||||||||
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Coca-Cola Co. 4.2% 3/25/2050 Anheuser-Busch Inbev Worldwide Inc. 3.5% 6/1/2030 Oracle Corp. 3.6% 4/1/2050 Nvidia Corp. 2.85% 4/1/2030 Lowe’s Companies Inc. 5.125% 4/15/2050 |
Industry Returns Tracker | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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New Issues | New Issues [Continued] |
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1. Hyundai Capital America (USD) 5.75% 4/6/2023 144A (04/02/2020): 550MM Senior Unsecured Notes, Price at Issuance 99.886, Yielding 5.79%.
2. Hyundai Capital America (USD) 6.375% 4/8/2030 Reg S (04/02/2020): 650MM Senior Unsecured Notes, Price at Issuance 99.941, Yielding 6.38%. 3. T-Mobile USA Inc. (USD) 4.5% 4/15/2050 Reg S (04/02/2020): 3000MM Secured Notes, Price at Issuance 99.575, Yielding 4.53%. 4. T-Mobile USA Inc. (USD) 3.75% 4/15/2027 Reg S (04/02/2020): 4000MM Secured Notes, Price at Issuance 99.957, Yielding 3.76%. 5. TransDigm Group Inc. (USD) 8% 12/15/2025 144A (04/02/2020): 1100MM Secured Notes, Price at Issuance 100, Yielding 8%. 6. TransDigm Group Inc. (USD) 8% 12/15/2025 Reg S (04/02/2020): 1100MM Secured Notes, Price at Issuance 100, Yielding 8%. 7. Ontario Power Generation Inc. (CAD) 2.893% 4/8/2025 (04/02/2020): 400MM Senior Unsecured Notes, Price at Issuance 100, Yielding 2.89%. 8. Ontario Power Generation Inc. (CAD) 3.215% 4/8/2030 (04/02/2020): 800MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.22%. 9. Hyundai Capital America (USD) 5.875% 4/7/2025 144A (04/02/2020): 600MM Senior Unsecured Notes, Price at Issuance 99.919, Yielding 5.89%. 10. Carnival Corp. (USD) 11.5% 4/1/2023 144A (04/02/2020): 4000MM First Lien Notes, Price at Issuance 99, Yielding 11.901%. |
Top Widening Loans | Top Narrowing Loans |
J Crew Group Inc. (USD) TLB L+322 03/06/2021 Arvos Holding (EUR) TLB2 E+450 08/29/2021 Advantage Sales & Marketing Inc. (USD) TL2 L+650 07/25/2022 Tipico Co. LTD (EUR) TLB E+350 08/08/2022 Quest Software US Holdings Inc (USD) TL L+425 05/17/2025 |
Booz Allen Hamilton Inc. (USD) TL L+175 11/22/2026 Concordia International (EUR) TL E+525 09/06/2024 Hamilton Holdco LLC (USD) TLB L+200 01/02/2027 Prosol Gestion (EUR) TLB E+400 04/21/2024 ATI Holdings (USD) TLB L+350 05/10/2023 |
SYNDICATED LOANS HIGHLIGHTS:
Deals recently freed for secondary trading, notable secondary activity:
- Symantec Corp., Broadcom LTD, Toll Brothers Inc., Cole-Parmer Instrument Co.
OVERALL CREDIT MARKET:
Long-term bond yields are expected to hit a cyclical peak in 2019 given tight fiscal policy and lagging global economies. Europe remains checked by stubbornly low inflationary forces. Positive effects remained in force:
- TED spread held below 130 bp (basis points), as of 04/3/2020
- Net positive capital flows into high-yield ETFs & mutual funds
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