Resources

CCS – No Traded CDS, Base Case iCDS 200bps, Negative Case iCDS 276bps, 2027 6.750% Bond YTW of 4.019%, iYTW of 2.879%, B1 Rating from Moody’s, IG4+ (equivalent to Baa1) Rating from Valens, Low Refinancing Need

April 12, 2021

  • Credit markets are overstating CCS’s credit risk with a YTW of 4.019%, relative to an Intrinsic YTW of 2.879% and an Intrinsic CDS of 200bps. Meanwhile, Moody’s is materially overstating the firm’s fundamental credit risk, with its speculative B1 credit rating six notches lower than Valens’ IG4+ (Baa1) credit rating
  • Incentives Dictate Behavior™ analysis highlights that CCS’s management compensation framework is mostly negative for credit holders. That said, management’s compensation framework should drive them to focus primarily on top-line growth and margin expansion, leading to potential Uniform ROA improvement
  • Earnings Call Forensics™ of the firm’s Q4 2020 earnings call (2/4) highlights that management is confident 2020 pretax income is the highest in firm history

You don’t have access to the Valens Research Premium Application.

To get access to our best content including the highly regarded Conviction Long List and Market Phase Cycle macro newsletter, please contact our Client Relations Team at 630-841-0683 or email client.relations@valens-research.com.

Please fill out the fields below so that our client relations team can contact you

Or contact our Client Relationship Team at 630-841-0683