June 27, 2019

Valens Credit Weekly Insights for June 26, 2019


Credit and Market Mispricings

Most Compelling Credit v Equity Market Mispricings
CYHDISHHTZAVPUIS

Most Compelling Credit Rating Dislocations
MTWAMDYRCWBZHEXPERIGLENCSTMKBHBHC 

Most Compelling CDS Market Mispricings
CHKDISHXRIGGTTMUSAERUISBZHR

Most Compelling Bond Market Mispricings
MDRADNTMGMCHKMTWRADXGTTDISHSKT

Highlighted Top Ideas
DAL – Delta Air Lines, Inc.
TDG – TransDigm Group Incorporated
TMUS – T-Mobile US, Inc.

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

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, 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 mostly tightened. Lower cost for borrowing is favorable for refinancing and borrowing for new credit creation.

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