GLOBAL MARKETS WERE MIXED AS COVID IS CONTINUING TO SURGE. STIMULUS TALKS ARE AT A DEADLOCK UNTIL PROBABLY THE GEORGIA SENATE RACE DETERMINES WHO CONTROLS THE SENATE. 10 Year Treasury notes were UP 2.8 bps. S&P -0.13%, Dow -0.23%, NASDAQ +0.54%.
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Market Summaries
North American Bond Research – December 10, 2020
Posted on December 10, 2020|
HIGH YIELD BOND RESEARCH
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December 10, 2020
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Bond Markets
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 70.6 MILLION+ CASES AND 1.59 MILLION DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 16 MILLION+ CASES AND 300000+ 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 | ||||||||||||||||||||||||||||||
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Vale Overseas LTD 3.75% 7/8/2030 Pacific Gas & Electric Co. 4.5% 12/15/2041 Pacific Gas & Electric Co. 4.55% 7/1/2030 Occidental Petroleum Corp. 5.5% 12/1/2025 US Steel Corp. 6.65% 6/1/2037 United States STL Corp. New 6.25% 3/15/2026 Occidental Petroleum Corp. 6.125% 1/1/2031 Vale Overseas LTD 6.25% 8/10/2026 Occidental Petroleum Corp. 5.875% 9/1/2025 Citigroup Inc. VAR% PERP (4) |
| Industry Returns Tracker | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | Forward Calendar |
|---|---|
| 1. Austin Bidco Inc. (USD) 7.125% 12/15/2028 144A (12/09/2020): 300MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.13%.
2. Global Net Lease Inc. (USD) 3.75% 12/15/2027 144A (12/09/2020): 500MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.75%. 3. Blue Racer Midstream LLC (USD) 7.625% 12/15/2025 144A (12/09/2020): 600MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.63%. 4. Vedanta Resources PLC (USD) 13.875% 1/21/2024 Reg S (12/09/2020): 1000MM Senior Unsecured Notes. 5. UEP Penonome II SA (USD) 6.5% 10/1/2038 Reg S (12/09/2020): 262MM Secured Notes, Price at Issuance 100, Yielding 6.5%. 6. Blue Racer Midstream LLC (USD) 7.625% 12/15/2025 Reg S (12/09/2020): 600MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.63%. 7. Austin Bidco Inc. (USD) 7.125% 12/15/2028 Reg S (12/09/2020): 300MM Senior Unsecured Notes, Price at Issuance 100, Yielding 7.13%. 8. Fortress Trans & Inf Inv LLC (USD) 6.5% 10/1/2025 (12/09/2020): 400MM Senior Unsecured Notes, Price at Issuance 101.75, Yielding 6.07%. 9. LBM Acquisition LLC (USD) 6.25% 1/15/2029 Reg S (12/09/2020): 550MM Senior Unsecured Notes, Price at Issuance 100, Yielding 6.25%. 10. LBM Acquisition LLC (USD) 6.25% 1/15/2029 144A (12/09/2020): 550MM Senior Unsecured Notes, Price at Issuance 100, Yielding 6.25%. |
1. Unified Women’s Healthcare LP: $560MM TLs: $420MM TLB (B-); $140MM TL
2. Ozark Holdings LLC: $400MM TLB 3. Provation Software Group Inc.: $330MM TLs: $250MM TL; $80MM TL2 4. Energizer Holdings Inc.: $1.2B TLB (BB+) 5. Adtalem: $1.4B credit facilities: $400MM revolver; $1B TLB 6. Centerfield: $500MM TL (B2/B): $400MM TLB; $100MM DD 7. Asurion LLC: $2.087B TLB8 8. American Public Education Inc.: $195MM credit facilities: $20MM revolver; $175MM TLB 9. Commercehub Inc.: $790MM senior credit facilities: $50MM revolver; $530MM TLB; $210MM TL 10. Unified Women’s Healthcare LP: $560MM TLs: $420MM TLB (B-); $140MM TL |
Additional Commentary
NEW ISSUANCE WATCH: Austin Bidco Inc. issued 500 MM in notes.
| Top Widening Loans | Top Narrowing Loans |
| GIP III Stetson I (USD) TLB L+425 07/18/2025 Aernnova Aerospace SA (EUR) TLB E+300 01/31/2027 LA Fitness PLC (USD) TLA L+225 01/08/2025 Compass IV LTD (EUR) TL E+800 05/09/2026 Odyssey Logistics & Technology Corp. (USD) TL L+375 10/12/2024 |
iHeartCommunications Inc. (USD) RC L+150 05/01/2023 Comet Bidco LTD (GBP) TLB L+500 10/06/2024 Radio One (USD) TLB L+400 04/18/2023 Securus Technologies Inc. (USD) TL L+450 11/01/2024 StandardAero (USD) TL L+350 04/08/2026 |
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 15 bps (basis points), as of 12/10/2020
- Net negative capital flows into high-yield ETFs & mutual funds
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INVESTMENT GRADE BOND RESEARCH
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December 10, 2020
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Bond Markets
GLOBAL MARKETS WERE MIXED AS COVID IS CONTINUING TO SURGE. STIMULUS TALKS ARE AT A DEADLOCK UNTIL PROBABLY THE GEORGIA SENATE RACE DETERMINES WHO CONTROLS THE SENATE. 10 Year Treasury notes were UP 2.8 bps. S&P -0.13%, Dow -0.23%, NASDAQ +0.54%.
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 70.6 MILLION+ CASES AND 1.59 MILLION DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 16 MILLION+ CASES AND 300000+ DEATHS. Among high-grade bonds showing topmost price gains at appreciable volumes traded, Halliburton Co. (USD) 5% 11/15/2045 made analysts’ ‘Conviction Buy’ list. (See the chart below for Halliburton Co. bonds) Pierre Robert
| Key Gainers and Losers | Volume Leaders | ||||||||||||||||||||||||||||||
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Boeing Co. 3.625% 2/1/2031 Anheuser-Busch Inbev Worldwide Inc. 4.5% 6/1/2050 GE Capital Intl. Funding Co. 4.418% 11/15/2035 Gilead Sciences Inc. 2.8% 10/1/2050 Boeing Co. 5.805% 5/1/2050 Nasdaq Inc. 1.65% 1/15/2031 CVS Health Corp. 5.05% 3/25/2048 General Electric Co. 4.35% 5/1/2050 Verizon Communications Inc. 2.875% 11/20/2050 Home Depot Inc. 3.35% 4/15/2050 |
| Industry Returns Tracker | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | New Issues [Continued] |
|---|---|
| 1. Ascot Group Limited (USD) 4.25% 12/15/2030 144A (12/09/2020): 400MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.25%.
2. Realty Income Corp. (USD) 0.75% 3/15/2026 (12/09/2020): 325MM Senior Unsecured Notes, Price at Issuance 99.192, Yielding .91%. 3. Enfragen Energia Sur SA (USD) 5.375% 12/30/2030 Reg S (12/09/2020): 710MM Secured Notes, Price at Issuance 99.039, Yielding 5.5%. 4. Global Net Lease Inc. (USD) 3.75% 12/15/2027 Reg S (12/09/2020): 500MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.75%. 5. RioCan Realty Investments Partnership Ten LP (CAD) 1.974% 6/15/2026 (12/09/2020): 500MM Senior Unsecured Notes, Price at Issuance 100, Yielding 1.97%. 6. Phoenician RE LTD. (USD) FLT% 12/14/2023 (12/09/2020): 95MM Unsecured Notes, Price at Issuance 100. 7. Chip Mortgage Trust (CAD) 1.738% 12/15/2025 (12/10/2020): 250MM Secured Notes, Price at Issuance 100, Yielding 1.74%. |
Additional Commentary
NEW ISSUANCE WATCH: Charles Schwab Corp issued 2500 MM in notes.
| Top Widening Loans | Top Narrowing Loans |
| GIP III Stetson I (USD) TLB L+425 07/18/2025 Aernnova Aerospace SA (EUR) TLB E+300 01/31/2027 LA Fitness PLC (USD) TLA L+225 01/08/2025 Compass IV LTD (EUR) TL E+800 05/09/2026 Odyssey Logistics & Technology Corp. (USD) TL L+375 10/12/2024 |
iHeartCommunications Inc. (USD) RC L+150 05/01/2023 Comet Bidco LTD (GBP) TLB L+500 10/06/2024 Radio One (USD) TLB L+400 04/18/2023 Securus Technologies Inc. (USD) TL L+450 11/01/2024 StandardAero (USD) TL L+350 04/08/2026 |
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 bps (basis points), as of 12/09/2020
- Net positive capital flows into high-yield ETFs & mutual funds
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