Valens Credit Weekly Insights for June 26, 2019
Credit and Market Mispricings
Most Compelling Credit v Equity Market Mispricings
CYH, DISH, HTZ, AVP, UIS
Most Compelling Credit Rating Dislocations
MTW, AMD, YRCW, BZH, EXPE, RIG, LEN, CSTM, KBH, BHC
Most Compelling CDS Market Mispricings
CHK, DISH, X, RIG, GT, TMUS, AER, UIS, BZH, R
Most Compelling Bond Market Mispricings
MDR, ADNT, MGM, CHK, MTW, RAD, X, GTT, DISH, SKT
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.