DISH notes weaken in active trade; Community Health bonds gain steam in secondary

By Abigail W. Adams

Portland, Me., March 8 – The distressed debt space closed the week as it began – quietly.

While volumes remained thin with few making moves as markets await the Fed’s next move, the tone continued to firm with the market seeing the latest non-farm payrolls report as a positive, a source said.

With the topical trades that drove activity earlier in the week fading, large liquid issues were largely responsible for driving volumes in the space.

DISH DBS Corp.’s senior notes were weaker in active trade on Friday.

The notes have been in focus since parent company EchoStar Corp. issued a going-concern statement on Feb. 29 and stated it did not have enough cash on hand to cover the 5 7/8% notes maturing on Nov. 15, 2024.

However, DISH DBS’ debt stack was mixed in response to the news with some tranches posting gains as the company actively works to secure the necessary financing.

Community Health Systems Inc.’s senior notes continued their upward momentum on Friday after seeing a strong uptrend over the past two weeks.

DISH DBS declines

DISH DBS’ senior notes continued to trade actively in the distressed debt space with several tranches weaker after making solid gains over the past week.

DISH’s 5¾% senior notes due 2028 (Caa1/B-) gave back about ¼ point although they remained on a 70-handle.

The notes were trading at 70½ heading into the market close with the yield 14 5/8%, a source said.

There was $7 million in reported volume.

The notes have added about 1 point over the past week.

DISH’s 7¾% senior notes due 2026 (Caa3/CC) were off about ½ point with the notes closing the day on a 68-handle.

They were trading at 68½ in the late afternoon with the yield about 27%.

The notes have added about 2 points over the past week.

While DISH’s bonds have been mixed in response to parent company EchoStar’s going-concern warning, there was no fire sale in the name with several tranches gaining strength.

The market is responding favorably to EchoStar’s latest efforts to shore up financing, a source said.

Community Health gains

Community Health’s senior notes continued their upward momentum on Friday after making strong gains over the past two weeks.

The 6 1/8% senior secured second-lien notes due 2030 (Caa3/CCC-) added another ½ to 1 point.

They were wrapped around 66 in the late afternoon with the yield 14 7/8%, according to a market source.

The notes have gained 6 points over the past week and a half.

The notes were trading on a 60-handle at the end of February.

Community Health’s 6 7/8% senior notes due 2028 (Ca/CCC-) added 1 point to close on a 67-handle.

They were trading in the 67 3/8 to 67 5/8 context during the session, a source said.

The notes have made strong gains over the past two months with the notes trading on a 60-handle in January.

Indexes

The S&P U.S. High Yield Corporate Distressed Bond index gained 0.31% on Thursday with the year-to-date return now 3.63%.

The index added 0.19% on Wednesday, 0.02% on Tuesday and 0.26% on Monday.

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