Spectranetics flat to better on swap after warning; Iconix comes in; Cobalt in upper 60s

By Rebecca Melvin

New York, July 24 – Spectranetics Corp.’s convertibles slumped on an outright basis but were flat to better on a dollar-neutral, or swap, basis on Friday after the common shares of the Colorado Springs, Colo.-based medical device maker tanked on lowered full-year revenue guidance.

The Spectranetics convertibles were at 89.5 bid, 90.5 offered versus an underlying common share price of $17.00, a New York-based trader said Friday afternoon.

That was flat, or in line, on a dollar-neutral basis if holders were on a delta hedge of 60%, the trader said. The stock fell 34%.

Iconix Brand Group Inc.’s 2.5% convertibles due 2016 were also lower on a swap basis with the common shares of the New York-based brand management company down 3%.

“The Iconix bonds were in 0.375 point but that took out a big seller,” a trader said.

U.S. convertibles put in a mostly quiet session on Friday, but were down for the week, market sources said.

The poor tone in the broader markets and lack of a forward calendar for new convertibles deals meant that there was little pressure on market players to make decisions, a New York-based trader said.

Even energy names, which had been weakening this past week, were stable with little by way of trades to report, the trader said.

Cobalt International Energy Inc.’s convertibles traded a bit with the Cobalt 2.625% convertibles trading down into the 60s this week and last seen on Friday at 67.5. Cobalt’s common stock was down a nickel at $7.95.

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