GLOBAL MARKETS ARE UP AS CHINA REPORTED BETTER ECONOMIC DATA OF 5.6% MANUFACTURING GROWTH, VERSUS 5.1 CONSENSUS AND CONSUMER SALES ROSE 0.5% FOR THE MONTH OF AUGUST. 10 Year Treasury notes were up .8 bps. S&P +0.52%, Dow +0.01%, NASDAQ +1.21%.
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Market Summaries
North American Bond Research – September 15, 2020
Posted on September 15, 2020|
HIGH YIELD BOND RESEARCH
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September 15, 2020
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Bond Markets
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 29.7 MILLION+ CASES AND 938000+ DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 6.8 MILLION+ CASES AND 200000+ 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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HCA Inc. 5% 3/15/2024 Pacific Gas & Electric Co. 4.95% 7/1/2050 Cheniere Corpus Christi Hldgs LLC 5.125% 6/30/2027 T-Mobile USA Inc. 3.875% 4/15/2030 144A Cheniere Corpus Christi Hldgs LLC 7% 6/30/2024 Pacific Gas & Electric Co. 4.55% 7/1/2030 Broadcom LTD 4.7% 4/15/2025 T-Mobile USA Inc. 3.5% 4/15/2025 144A Equinix Inc. 5.375% 5/15/2027 T-Mobile USA Inc. 3.75% 4/15/2027 144A |
| Industry Returns Tracker | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | Forward Calendar |
|---|---|
| 1. Gartner Inc. (USD) 3.75% 10/1/2030 144A (09/14/2020): 800MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.75%.
2. Hologic Inc. (USD) 3.25% 2/15/2029 144A (09/14/2020): 950MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.25%. 3. NEW Residential Investment Corp. (USD) 6.25% 10/15/2025 144A (09/14/2020): 550MM Senior Unsecured Notes, Price at Issuance 100, Yielding 6.25%. 4. Uber Technologies Inc. (USD) 6.25% 1/14/2028 144A (09/14/2020): 500MM Senior Unsecured Notes, Price at Issuance 100, Yielding 6.25%. 5. Gartner Inc. (USD) 3.75% 10/1/2030 Reg S (09/14/2020): 800MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.75%. 6. Hologic Inc. (USD) 3.25% 2/15/2029 Reg S (09/14/2020): 950MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.25%. 7. NEW Residential Investment Corp. (USD) 6.25% 10/15/2025 Reg S (09/14/2020): 550MM Senior Unsecured Notes, Price at Issuance 100, Yielding 6.25%. 8. Uber Technologies Inc. (USD) 6.25% 1/15/2028 Reg S (09/14/2020): 500MM Senior Unsecured Notes, Price at Issuance 100, Yielding 6.25%. 9. Shea Homes LP (USD) 4.75% 4/1/2029 144A (09/14/2020): 300MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.75%. 10. Shea Homes LP (USD) 4.75% 4/1/2029 Reg S (09/14/2020): 300MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.75%. |
1. Allegro Microsystems Inc.: $325MM TL
2. Cablevision Lightpath: $600MM TL (B1/B+) 3. CJ Foods Inc.: $285MM TLB 4. MAG Aerospace: $290.7MM TL (B3/B) 5. Michael Cos Inc.: $1.62B TLB (B+) 6. Vander-Bend Manufacturing Inc.: $197.5MM credit facilities: $20MM revolver; $177.5MM TLB 7. RCN Grande: $1.19B TLB 8. MAG Aerospace: $290.7MM TL (B3/B) 9. CJ Foods Inc.: $285MM TLB 10. Cablevision Lightpath: $600MM TL (B1/B+) |
Additional Commentary
NEW ISSUANCE WATCH: Shea Homes LP issued 300MM in notes
| Top Widening Loans | Top Narrowing Loans |
| Corialis (GBP) TL L+850 03/31/2025 Hurtigruten Group AS (EUR) TLC E+800 06/16/2023 BBB Industries LLC (USD) TL L+450 08/01/2025 Averys SA (EUR) TLB E+825 09/25/2026 CPV Shore LLC (USD) TLB L+375 12/27/2025 |
Valeo Foods Group LTD (GBP) TL L+850 08/27/2028 United PF Holdings LLC (USD) TL L+400 01/06/2027 Kindercare Education LLC (USD) TL L+825 08/16/2025 Ascent Resources Marcellus LLC (USD) TL EXT L+650 12/31/2049 Encapsys LLC (USD) TL L+350 11/07/2024 |
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 14 bp (basis points), as of 09/15/2020
- Net negative capital flows into high-yield ETFs & mutual funds
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INVESTMENT GRADE BOND RESEARCH
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September 15, 2020
|
Bond Markets
GLOBAL MARKETS ARE UP AS CHINA REPORTED BETTER ECONOMIC DATA OF 5.6% MANUFACTURING GROWTH, VERSUS 5.1 CONSENSUS AND CONSUMER SALES ROSE 0.5% FOR THE MONTH OF AUGUST. 10 Year Treasury notes were up .8 bps. S&P +0.52%, Dow +0.01%, NASDAQ +1.21%.
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 29.7 MILLION+ CASES AND 938000+ DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 6.8 MILLION+ CASES AND 200000+ 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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Enterprise Products Operating LLC 2.8% 1/31/2030 Toronto-Dominion Bank 0.75% 9/11/2025 Suzano Austria GmbH 3.75% 1/15/2031 Dupont de Nemours Inc. 2.169% 5/1/2023 Oracle Corp. 3.85% 4/1/2060 Deutsche Bank AG VAR% 9/18/2031 Southwest Airlines Co. 5.25% 5/4/2025 Boeing Co. 5.15% 5/1/2030 Lowe’s Companies Inc. 4.5% 4/15/2030 Cummins Inc. 1.5% 9/1/2030 |
| Industry Returns Tracker | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | New Issues [Continued] |
|---|---|
| 1. Flowserve Corp. (USD) 3.5% 10/1/2030 (09/14/2020): 500MM Senior Unsecured Notes, Price at Issuance 99.656, Yielding 3.54%.
2. Summit Industrial Income Reit (CAD) 2.15% 9/17/2025 (09/14/2020): 250MM Senior Unsecured Notes, Price at Issuance 99.962, Yielding 2.16%. 3. HollyFrontier Corp. (USD) 2.625% 10/1/2023 (09/14/2020): 350MM Senior Unsecured Notes, Price at Issuance 99.894, Yielding 2.66%. 4. HollyFrontier Corp. (USD) 4.5% 10/1/2030 (09/14/2020): 400MM Senior Unsecured Notes, Price at Issuance 99.824, Yielding 4.52%. 5. Healthcare Trust of America Inc. (USD) 2% 3/15/2031 (09/14/2020): 800MM Senior Unsecured Notes, Price at Issuance 99.196, Yielding 2.09%. 6. WEC Energy Group Inc. (USD) 0.55% 9/15/2023 (09/14/2020): 700MM Senior Unsecured Notes, Price at Issuance 99.964, Yielding .56%. 7. Protective Life Global Funding (USD) 1.737% 9/21/2030 144A (09/14/2020): 350MM Secured Notes, Price at Issuance 100, Yielding 1.74%. 8. Empower Finance 2020 LP (USD) 3.075% 9/17/2051 144A (09/14/2020): 700MM Senior Unsecured Notes, Price at Issuance 100, Yielding 3.08%. 9. Coca-Cola Co. (USD) 2.5% 3/15/2051 (09/14/2020): 1500MM Senior Unsecured Notes, Price at Issuance 99.386, Yielding 2.53%. 10. Coca-Cola Co. (USD) 1% 3/15/2028 (09/14/2020): 1300MM Senior Unsecured Notes, Price at Issuance 99.921, Yielding 1.01%. |
Additional Commentary
NEW ISSUANCE WATCH: Coca-Cola Co. issued 2800MM in notes.
| Top Widening Loans | Top Narrowing Loans |
| Corialis (GBP) TL L+850 03/31/2025 Hurtigruten Group AS (EUR) TLC E+800 06/16/2023 BBB Industries LLC (USD) TL L+450 08/01/2025 Averys SA (EUR) TLB E+825 09/25/2026 CPV Shore LLC (USD) TLB L+375 12/27/2025 |
Valeo Foods Group LTD (GBP) TL L+850 08/27/2028 United PF Holdings LLC (USD) TL L+400 01/06/2027 Kindercare Education LLC (USD) TL L+825 08/16/2025 Ascent Resources Marcellus LLC (USD) TL EXT L+650 12/31/2049 Encapsys LLC (USD) TL L+350 11/07/2024 |
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 14 bp (basis points), as of 09/15/2020
- Net positive capital flows into high-yield ETFs & mutual funds
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