July 18, 2019

Valens Credit Weekly Insights for July 17, 2019


Credit and Market Mispricings

Most Compelling Credit v Equity Market Mispricings
AVPCYHDISHHTZUIS

Most Compelling Credit Rating Dislocations
ADNTAMDBHCBZHCSTMEXPEKBHLENMTWYRCW 

Most Compelling CDS Market Mispricings
AERBZHCHKDISHMTORRRIGTMUSUISX 

Most Compelling Bond Market Mispricings
ADNTAERCSTMCVIGTTMDRMGMMTWRADSKT

Highlighted Top Ideas
AN – AutoNation, Inc.
CVI – CVR Energy, Inc.
RIG – Transocean Ltd.


Aggregate Credit Market and Credit Fundamental Review

IG and XO markets are currently fairly valued. HY markets have seen CDS move wider than iCDS again recently. Overall, costs of borrowing have reversed their trend higher through 2018 so far in 2019, as both the risk free rate and corporate spreads (CDS levels) have mostly tightened. Lower cost for borrowing is favorable for refinancing and borrowing for new credit creation.


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