Clear Channel paper inches up; Sprint Nextel mixed pre-earnings; energy sector gets a lift

By Stephanie N. Rotondo

Portland, Ore., Feb. 7 - Distressed debt was "grinding higher for the most part," a trader said Tuesday.

"Inflows are coming in so people need bonds," he said.

Still, investor focus continued to be on new high-yield issues.

Clear Channel Communications Inc. paper was active and rising, though there was no major news out on the San Antonio-based multimedia company. Sprint Nextel Corp. was also on the active side, but unchanged to weaker as investors prepared for the company's earnings release on Wednesday.

Energy names remained firm in Tuesday trading. Dynegy Holdings LLC debt continued to gain momentum, as did Edison International Inc. paper.

There was no fresh news out on either credit to act as catalyst.

Clear Channel rises

A trader said Clear Channel Communications' paper was trending higher during Tuesday's session.

He saw the 10¾% notes due 2016 move up over a point to 81, while the 11% notes due 2016 gained a point to end at 781/4.

There was no major news out on the company, though Fitch Ratings did say that it had affirmed its ratings on the business. Fitch said the outlook was stable but noted that it was concerned about the company's highly leveraged capital structure - which includes significant maturities in 2014 and 2016.

Clear Channel will report earnings next week.

Sprint mixed pre-earnings

Investors are gearing up for Sprint Nextel's earnings release on Wednesday. On Tuesday, the bonds were trading steady to a touch weaker.

A trader called the 6% notes due 2016 down half a point at 88 7/8. However, he said he "didn't see much change" in the 6.9% notes due 2019, the 8 3/8% notes due 2017 or the 6 7/8% notes due 2028.

The 6.9% notes closed at 86, the 8 3/8% notes at 95 and the 6 7/8% notes at 75.

The Overland Park, Kan.-based telecommunications provider is scheduled to report fourth-quarter earnings on Wednesday, with analysts predicting a loss of 35 to 37 cents per share, almost four times its third-quarter red ink of 10 cents per share, and greater than the 29 cents per share loss seen a year ago. But Sprint's Nasdaq-traded shares have been firming over the past few sessions, and were up another 6% on Monday on nearly twice their normal volume.

The stock weakened a tad on Tuesday, but volume was again over twice the normal daily volume.

Dynegy, Edison gain ground

The energy sector has been creeping higher in the last few sessions, though there has not been any credit-specific news to prompt the gains.

Dynegy Holdings, the bankrupt subsidiary of Houston-based Dynegy Inc., has been on a tear of late, and that continued into Tuesday trading, a trader said.

He placed the 8 3/8% notes due 2016 at 68 and the 7¾% notes due 2019 at 671/2.

Another market source called the 7¾% notes up a half-point at 65½ bid.

Meanwhile, Rosemead, Calif.-based Edison International was also climbing higher.

A trader called the 7% notes due 2017 up half a point at 631/2. Another trader said the debt was "a little better," also at 631/2.

Kodak moves up

A trader said he saw "a little action" in Eastman Kodak Co.'s 7¼% notes due 2013.

He called the issue "maybe a little better" at 311/2.

Another trader also said the notes were "a little better," also at 311/2.

There was no fresh news out on the Rochester, N.Y.-based company.

Broad market mixed

Among other distressed issues, Sears Holdings Corp.'s 6 5/8% notes due 2018 were unchanged at around 84, according to a trader.

The trader also saw Caesars Entertainment Corp.'s 10% notes due 2018 falling half a point to 791/2.

At another shop, a trader said Ahern Rentals Inc.'s 9¼% notes due 2013 were "up a couple points" to around 46.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.