June 13, 2019

Valens Credit Weekly Insights for June 12, 2019


Credit and Market Mispricings

Most Compelling Credit v Equity Market Mispricings
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Most Compelling Credit Rating Dislocations
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Most Compelling CDS Market Mispricings
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Most Compelling Bond Market Mispricings
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Highlighted Top Ideas
AXL – American Axle & Manufacturing Holdings, Inc.
GTT – GTT Communications, Inc.
MCK – McKesson Corporation


Quantitative Credit Outlier Report Review
TCG:GBR tops our quantitative outlier report this week.


Aggregate Credit Market and Credit Fundamental Review
IG markets are currently fairly valued. XO and HY markets have also moved to fairly valued levels, with CDS converging towards iCDS levels. Overall, cost 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 tightened. Lower cost for borrowing is favorable for refinancing and borrowing for new credit creation.


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