AMKR – Base Case iCDS 80bps, Negative Case iCDS 109bps, 2027 6.625% Bond YTW of 5.533%, iYTW of 4.423%, Ba2 Rating from Moody’s, IG4+ (equivalent to Baa2) Rating from Valens, Low Refinancing Need
September 18, 2024
- Cash bond markets are overstating credit risk with a YTW of 5.533% relative to an Intrinsic YTW of 4.423%, while CDS markets are accurately stating credit risk with a CDS of 92bps relative to an Intrinsic CDS of 80bps. Meanwhile, Moody’s is overstating AMKR’s fundamental credit risk, with its Ba2 credit rating four notches lower than Valens’ IG4+ (Baa2) rating.
- Incentives Dictate Behavior™ analysis highlights mostly negative signals for credit holders. That said, as a positive, management members have low change-in-control compensation relative to their average compensation, indicating they are unlikely to pursue a takeover or accept a sale of the company, decreasing event risk for creditors.
