Grid IconAll Posts Market Summaries

North American Bond Research – August 6, 2020

Posted on August 6, 2020
HIGH YIELD BOND RESEARCH
August 6, 2020
Bond Markets

JOBLESS CLAIMS OF 1.19 MILLION IS THE LOWEST SINCE MARCH AND THAT SENT US MARKETS HIGHER. THERE IS PRESSURE ON THE REPUBLICANS TO ACT QUICKLY TO EXTEND SOME ASSISTANCE TO THE MILLIONS OF UNEMPLOYED. 10 Year Treasury notes were down 7 bps. S&P +0.55%, Dow +1.15%, NASDAQ +0.45%.
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 19.2 MILLION+ CASES AND 716000+ DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 5.1 MILLION+ CASES AND 163000+ DEATHS.  Among high-grade bonds showing topmost price gains at appreciable volumes traded, Hertz Corp (The) (USD) 7% 1/15/2028 made analysts’ ‘Conviction Buy’ list. (See the chart below for Hertz Corp  bonds) Pierre Robert
Key Gainers and Losers Volume Leaders
+   T-Mobile USA Inc. 3.875% 4/15/2030 144A +0.5%
  T-Mobile USA Inc. 3.75% 4/15/2027 144A +0.4%
  Extraction Oil & Gas LLC 5.625% 2/1/2026 Reg S +156.9%
  ADT Corp. 6.25% 10/15/2021 +0.6%
  United Rentals North AM 3.875% 2/15/2031 +0.4%
–   Pacific Gas & Electric Co. 4.55% 7/1/2030 -0.3%
  Pacific Gas & Electric Co. 4.95% 7/1/2050 -0.2%
  Ford Motor Co. 8.5% 4/21/2023 -0.2%
  Transocean Sedco Forex Inc. 7.5% 4/15/2031 -11.3%
  American Axle & Manufacturing Inc. 6.5% 4/1/2027 -0.5%
Pacific Gas & Electric Co.   4.55% 7/1/2030
Pacific Gas & Electric Co.   4.95% 7/1/2050
T-Mobile USA Inc.   3.875% 4/15/2030 144A
Ford Motor Co.   8.5% 4/21/2023
T-Mobile USA Inc.   3.75% 4/15/2027 144A
Extraction Oil & Gas LLC   5.625% 2/1/2026 Reg S
ADT Corp.   6.25% 10/15/2021
Transocean Sedco Forex Inc.   7.5% 4/15/2031
United Rentals North AM   3.875% 2/15/2031
American Axle & Manufacturing Inc.   6.5% 4/1/2027
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing -0.07% 0.17% 3.82% 7.22% 4.71% 8.93%
Mining 0.39% 1.24% 6.97% 29.92% -10.88% -5.99%
Construction 0.12% 0.81% 4.04% 11.28% 3.51% 8.36%
Manufacturing 0.11% 0.67% 4.17% 11.67% 1.78% 7.40%
Transportion, Communication, Electric/Gas 0.06% 0.58% 3.20% 8.51% 4.11% 8.20%
Wholesale -0.00% 0.74% 3.66% 11.04% 2.74% 7.12%
Retail 0.07% 0.81% 4.41% 12.51% -0.32% 4.12%
Finance, Insurance, Real-Estate 0.09% 0.63% 3.33% 10.36% 0.91% 5.31%
Services 0.06% 0.66% 4.29% 10.27% 1.91% 7.13%
Public Administration 0.41% 1.61% 3.56% 11.32% 5.07% 9.12%
Energy 0.37% 1.27% 6.84% 26.02% -8.85% -3.92%
 
Total returns (non-annualized) by rating, market weighted.

New Issues Forward Calendar
1. Triumph Group Inc. (USD) 8.875% 6/1/2024 144A (08/05/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 8.88%.

2. Triumph Group Inc. (USD) 8.875% 6/1/2024 (08/05/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 8.88%.

3. Triumph Group Inc. (USD) 8.875% 6/1/2024 Reg S (08/05/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 8.88%.

4. Harvest Midstream I LP (USD) 7.5% 9/1/2028 144A (08/05/2020): 600MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.5%.

5. Howard Hughes Corp. (USD) 5.375% 8/1/2028 144A (08/05/2020): 750MM Senior Unsecured Notes, Price at Issuance 100, Yielding 5.38%.

6. Harvest Midstream I LP (USD) 7.5% 9/1/2028 Reg S (08/05/2020): 600MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.5%.

7. Howard Hughes Corp. (USD) 5.375% 8/1/2028 Reg S (08/05/2020): 750MM Senior Unsecured Notes, Price at Issuance 100, Yielding 5.38%.

8. STL Holding Company LLC (USD) 7.5% 2/15/2026 Reg S (08/05/2020): 225MM Senior Unsecured Notes.

9. STL Holding Company LLC (USD) 7.5% 2/15/2026 144A (08/05/2020): 225MM Senior Unsecured Notes.

10. WMG Acquisition Corp. (USD) 3% 2/15/2031 144A (08/06/2020): 550MM Secured Notes, Price at Issuance 100, Yielding 3%.

1. CJ Foods Inc.: $285MM TLB

2. Logmein Inc.: $2.45B credit facilities: $1.95B first lien TL; $500MM second-lien TL

3. MAG Aerospace: $290.7MM TL (B3/B)

4. RSA: $1.425B credit facilities: $75MM revolver; $1B TL; $350MM TL

5. Smart Start Inc.: $350MM TLB

6. Tutor Perini: $375MM TLB (Ba3/BB-/BB+)

7. Concord : $1.05B credit facilities (B1/B+): $450MM revolver; $600MM TLB

8. RSA: $1.425B credit facilities: $75MM revolver; $1B TL; $350MM TL

9. MAG Aerospace: $290.7MM TL (B3/B)

10. Logmein Inc.: $3.55B credit facilities: $250MM Revolver; $2.7B first lien TL; $600MM second-lien TL

Additional Commentary

NEW ISSUANCE WATCH: AutoZone Inc. issued 600 MM in notes.
Top Widening Loans Top Narrowing Loans
Packaging Coordinators Inc. (USD) TL L+400 08/22/2023
Arvos Holding (EUR) TLB2 E+450 08/29/2021
Openlink Intl. Inc. (EUR) TLB E+450 03/02/2025
American Tire Distributors Inc. (USD) TL DIP PIK L+600 09/01/2023
CPV Shore LLC (USD) TLB L+375 12/27/2025
MMM Holdings Inc. (USD) RC 11/01/2024
Samsonite IP Holdings SARL (USD) TLA L+150 04/19/2023
Jazz Securities LTD (USD) TLA 06/07/2023
Nets Hldgs AS (NOK) TLB1N L+400 02/06/2025
Carrols Restaurant Group (USD) TLB1 L+625 04/30/2026

Loans and Credit Market Overview

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 16 bp (basis points), as of 08/05/2020
  • Net negative capital flows into high-yield ETFs & mutual funds

 

HIGH YIELD BOND RESEARCH
August 6, 2020
Bond Markets

JOBLESS CLAIMS OF 1.19 MILLION IS THE LOWEST SINCE MARCH AND THAT SENT US MARKETS HIGHER. THERE IS PRESSURE ON THE REPUBLICANS TO ACT QUICKLY TO EXTEND SOME ASSISTANCE TO THE MILLIONS OF UNEMPLOYED. 10 Year Treasury notes were down 7 bps. S&P +0.55%, Dow +1.15%, NASDAQ +0.45%.
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 19.2 MILLION+ CASES AND 716000+ DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 5.1 MILLION+ CASES AND 163000+ DEATHS.  Among high-grade bonds showing topmost price gains at appreciable volumes traded, Hertz Corp (The) (USD) 7% 1/15/2028 made analysts’ ‘Conviction Buy’ list. (See the chart below for Hertz Corp  bonds) Pierre Robert
Key Gainers and Losers Volume Leaders
+   T-Mobile USA Inc. 3.875% 4/15/2030 144A +0.5%
  T-Mobile USA Inc. 3.75% 4/15/2027 144A +0.4%
  Extraction Oil & Gas LLC 5.625% 2/1/2026 Reg S +156.9%
  ADT Corp. 6.25% 10/15/2021 +0.6%
  United Rentals North AM 3.875% 2/15/2031 +0.4%
  EQT Midstream Partners LP 6.5% 7/15/2048 +0.5%
–   Pacific Gas & Electric Co. 4.55% 7/1/2030 -0.3%
  Pacific Gas & Electric Co. 4.95% 7/1/2050 -0.2%
  Ford Motor Co. 8.5% 4/21/2023 -0.2%
  Transocean Sedco Forex Inc. 7.5% 4/15/2031 -11.3%
  American Axle & Manufacturing Inc. 6.5% 4/1/2027 -0.5%
Pacific Gas & Electric Co.   4.55% 7/1/2030
Pacific Gas & Electric Co.   4.95% 7/1/2050
T-Mobile USA Inc.   3.875% 4/15/2030 144A
Ford Motor Co.   8.5% 4/21/2023
T-Mobile USA Inc.   3.75% 4/15/2027 144A
Extraction Oil & Gas LLC   5.625% 2/1/2026 Reg S
ADT Corp.   6.25% 10/15/2021
Transocean Sedco Forex Inc.   7.5% 4/15/2031
United Rentals North AM   3.875% 2/15/2031
American Axle & Manufacturing Inc.   6.5% 4/1/2027
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing -0.07% 0.17% 3.82% 7.22% 4.71% 8.93%
Mining 0.39% 1.24% 6.97% 29.92% -10.88% -5.99%
Construction 0.12% 0.81% 4.04% 11.28% 3.51% 8.36%
Manufacturing 0.11% 0.67% 4.17% 11.67% 1.78% 7.40%
Transportion, Communication, Electric/Gas 0.06% 0.58% 3.20% 8.51% 4.11% 8.20%
Wholesale -0.00% 0.74% 3.66% 11.04% 2.74% 7.12%
Retail 0.07% 0.81% 4.41% 12.51% -0.32% 4.12%
Finance, Insurance, Real-Estate 0.09% 0.63% 3.33% 10.36% 0.91% 5.31%
Services 0.06% 0.66% 4.29% 10.27% 1.91% 7.13%
Public Administration 0.41% 1.61% 3.56% 11.32% 5.07% 9.12%
Energy 0.37% 1.27% 6.84% 26.02% -8.85% -3.92%
 
Total returns (non-annualized) by rating, market weighted.

New Issues Forward Calendar
1. Triumph Group Inc. (USD) 8.875% 6/1/2024 144A (08/05/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 8.88%.

2. Triumph Group Inc. (USD) 8.875% 6/1/2024 (08/05/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 8.88%.

3. Triumph Group Inc. (USD) 8.875% 6/1/2024 Reg S (08/05/2020): 700MM First Lien Notes, Price at Issuance 100, Yielding 8.88%.

4. Harvest Midstream I LP (USD) 7.5% 9/1/2028 144A (08/05/2020): 600MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.5%.

5. Howard Hughes Corp. (USD) 5.375% 8/1/2028 144A (08/05/2020): 750MM Senior Unsecured Notes, Price at Issuance 100, Yielding 5.38%.

6. Harvest Midstream I LP (USD) 7.5% 9/1/2028 Reg S (08/05/2020): 600MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.5%.

7. Howard Hughes Corp. (USD) 5.375% 8/1/2028 Reg S (08/05/2020): 750MM Senior Unsecured Notes, Price at Issuance 100, Yielding 5.38%.

8. STL Holding Company LLC (USD) 7.5% 2/15/2026 Reg S (08/05/2020): 225MM Senior Unsecured Notes.

9. STL Holding Company LLC (USD) 7.5% 2/15/2026 144A (08/05/2020): 225MM Senior Unsecured Notes.

10. WMG Acquisition Corp. (USD) 3% 2/15/2031 144A (08/06/2020): 550MM Secured Notes, Price at Issuance 100, Yielding 3%.

1. CJ Foods Inc.: $285MM TLB

2. Logmein Inc.: $2.45B credit facilities: $1.95B first lien TL; $500MM second-lien TL

3. MAG Aerospace: $290.7MM TL (B3/B)

4. RSA: $1.425B credit facilities: $75MM revolver; $1B TL; $350MM TL

5. Smart Start Inc.: $350MM TLB

6. Tutor Perini: $375MM TLB (Ba3/BB-/BB+)

7. Concord : $1.05B credit facilities (B1/B+): $450MM revolver; $600MM TLB

8. RSA: $1.425B credit facilities: $75MM revolver; $1B TL; $350MM TL

9. MAG Aerospace: $290.7MM TL (B3/B)

10. Logmein Inc.: $3.55B credit facilities: $250MM Revolver; $2.7B first lien TL; $600MM second-lien TL

Additional Commentary

NEW ISSUANCE WATCH: AutoZone Inc. issued 600 MM in notes.
Top Widening Loans Top Narrowing Loans
Packaging Coordinators Inc. (USD) TL L+400 08/22/2023
Arvos Holding (EUR) TLB2 E+450 08/29/2021
Openlink Intl. Inc. (EUR) TLB E+450 03/02/2025
American Tire Distributors Inc. (USD) TL DIP PIK L+600 09/01/2023
CPV Shore LLC (USD) TLB L+375 12/27/2025
MMM Holdings Inc. (USD) RC 11/01/2024
Samsonite IP Holdings SARL (USD) TLA L+150 04/19/2023
Jazz Securities LTD (USD) TLA 06/07/2023
Nets Hldgs AS (NOK) TLB1N L+400 02/06/2025
Carrols Restaurant Group (USD) TLB1 L+625 04/30/2026

Loans and Credit Market Overview

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 16 bp (basis points), as of 08/05/2020
  • Net negative capital flows into high-yield ETFs & mutual funds

Copyright 2020 Advantage Data Inc. All Rights Reserved. http://www.advantagedata.com

Information in this document should not be regarded as an offer to sell or solicitation of an offer to buy bonds or any financial instruments referred to herein. All information provided in this document is believed to be accurate. However, Advantage Data and its sources make no warranties, either express or implied, as to any matter whatsoever, including but not limited to warranties of merchantability or fitness for a particular purpose. Opinions in this document are subject to change without notice. Electronic redistribution, photocopying and any other electronic or mechanical reproduction is strictly prohibited without prior written permission from Advantage Data Inc.


Disclaimer: The information on this blog site is for informational purposes only.  Advantage Data makes no representations as to the accuracy, completeness, suitability, or validity, of any information. Advantage Data will not be liable for any errors, omissions, or any losses, injuries, or damages arising from its display or use. All information is provided AS-IS with no warranties and confers no rights. Information is not and should not be considered professional financial investment advice. In all events, Advantage Data is not a broker-dealer, shall not operate as a broker or a dealer, is not holding itself out as a broker or dealer and is not engaged in the business of buying or selling securities or otherwise required to register with the National Association of Securities Dealers.


Are you using AdvantageData?

AdvantageData is your fixed income solution for pricing, analytics, reports, and insight on approximately:

  • 500,000+ U.S. and international corporate bonds
  • Over 300,000+ BDC fair value assessments dating back to 2000
  • Over 22,000+ syndicated loans
  • Over 100 equity markets worldwide
  • One platform 15 products and services from debt to loans to mid-market
  • Used by top buy and sell-side firms worldwide

Share

facebook share icon twitter share icon linkedin share icon
Ready to get Started? Free Trial