September 28, 2016

Valens Credit Weekly Insights for September 28, 2016


Each week the Valens Credit team highlights our most interesting insights from across our tools and our analysis. This week interesting insights include:

Credit and Market Mispricings

Most Compelling Credit v Equity Market Mispricings
AN, CYH, NAV, SGMS, THC

a1

Most Compelling Credit Rating Dislocations
BLDR, EXPE, GM, JCP, R, TWTR, UIS, VRX, X, YRCW

a2

Most Compelling CDS Market Mispricings
AVP, AMD, CHK, HNT, NAV, PKD, RIG, SHLD, UIS, X

a3

Most Compelling Bond Market Mispricings
AKS, AMD, ATW, CHK, MDR, TSX:MEG, NAV, RIG, SVU, VRX

a4

Highlighted Top Ideas
AXL – American Axle & Manufacturing Holdings, Inc.
ESV – Ensco plc
LVLT – Level 3 Communications, Inc.

Other Recent Analyses
Consumer Discretionary
MGM – MGM Resorts International
Materials
MERC – Mercer International Inc.

Quantitative Credit Outlier Report Review
X, CHK, and AKS top 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.

If you are interested in seeing any of the highlighted analyses, please contact the Valens team at valens@valens-securities.com

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