Convertible bonds secondary action favorable for travel, crypto names on Monday

Chicago, July 18 – Several companies in the convertible bond space were trading better on Monday when no new deal action was announced to turn attention away from secondary trading.

Southwest Airlines Co. continues to be a liquid issue, a volume leader over the past few weeks.

Somewhat on a related note, travel company Booking Holdings Inc. journeyed higher on Monday.

Also, the perception of stabilization in Bitcoin improved the convertible bonds of names tied to crypto during the Monday session.

Flyin’

Monday’s convertible bond air space still belonged to Southwest Airlines’ 1.25% convertibles due 2025 (Baa1/BBB).

The notes are still active and reaching higher in terms of price.

The notes zoomed out of Monday’s gate and made it above 129 just after lunch before coming in from those lofty heights to land just above 128, representing a 2 point gain from Friday’s close at 126.

And, while the notes have been on an upswing, the upward momentum in prices represents a backtracking of a steep fall from grace when the bonds fell 17 points over eight days in June.

The 1.25% convertibles have yet to reclaim their June 8 trading price of 135.

The company’s stock is higher by 13.11% over the past month. On the day, it closed 0.93% better to land at $39.95.

Booking notes

Booking Holdings’ 0.75% convertible notes due 2025 were more subdued in trading volume on Monday but worked their way up.

Relatively liquid right now, the bonds ended Monday at 124.625, up around 2 points from the last trades on the tape on Friday.

The Norwalk, Conn., travel technology company’s stock is up 0.37% over the last five days, closing Monday at $1,738.79.

Bitcoin: Part I

The 0.5% five-year convertible bonds that priced from Coinbase Global Inc. as recently as the end of May sank no further on Monday against a surging stock price that was up 9.07% on the day.

The bonds clawed back around 1 point to close above 57.75, having hit 58 during the day once.

The bonds closed Friday at 56.75 after revisiting the 55 range on Thursday, bumping against an all-time low for the notes that priced at 99 and then precipitously dropped minutes after pricing.

Bitcoin has retraced some of its dramatic annual losses and is up 13.96% over the past month.

Coinbase, which has a fate tied to cryptocurrencies, has had a seesaw on its stock, but is up 2.05% over the past month.

Bitcoin: Part II

Another convertible note with exposure to Bitcoin was propelled back into motion on Monday as Marathon Digital Holdings Inc.’s 1% convertible notes due 2026 were pulled back onto the tape.

Also up on the day, the notes were seen right around 32 in midday trading.

The notes closed at 28.75 last Wednesday, when they were last moving.

Marathon Digital’s notes have been in decline over the last seven months. They rang in the new year above 80.

The Las Vegas company’s stock was an entire 21.39% better on Monday, closing at $9.76 versus an $8.04 close on Friday.

Mentioned in this article:

Southwest Airlines Co. NYSE: LUV

Booking Holdings Inc. Nasdaq: BKNG

Coinbase Global Inc. Nasdaq: COIN

Marathon Digital Holdings Inc. Nasdaq: MARA

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