December 21, 2017

Valens Credit Weekly Insights for December 20, 2017


Credit and Market Mispricings

Most Compelling Credit v Equity Market Mispricings
AVP, BLDR, CYH, NAV, UIS

Most Compelling Credit Rating Dislocations
AMD, BLDR, CHK, EXPE, JCP, MNI, R, UIS, X, YRCW

Most Compelling CDS Market Mispricings
AVP, CHK, CYH, ESV, JCP, MNI, PKD, UIS, X, SVU

Most Compelling Bond Market Mispricings
AKS, AMD, AVP, BLDR, CHK, CVI, FCX, PKD, RCII, RIG

Highlighted Top Ideas
AVP
– Avon Products, Inc.
NFX – Newfield Exploration Company
X – United States Steel Corporation

Other Recent Analyses
Industrials
OC – Owens Corning
Materials
WRK – WestRock Company

Quantitative Credit Outlier Report Review
CYH tops our quantitative outlier report this week.

Aggregate Credit Market and Credit Fundamental Review
IG markets are currently fairly valued, as are HY markets. However, even after XO CDS has normalized in the last several months, it remains substantially above XO iCDS levels. This indicates that the XO market is overstating credit risk.

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