Morning Commentary: Priceline jumps; SolarCity drops outright; Actavis offers mandatory

By Rebecca Melvin

New York, Feb. 19 – Several convertibles issuers reported quarterly results that spurred trades in their convertible debt early Thursday.

Priceline Group Inc. posted earnings that were better than forecasted, sending shares of the Norwalk, Conn.-based internet travel services company up 8%.

The Priceline 1% convertibles due 2018 rose 7 points in active trade to nearly 140, with shares at $1,214.89.

Also trading was Priceline’s 0.35% convertibles due 2020, which were up 4.6 points to 116.4.

SolarCity Corp.’s two convertible bond issues were trading down on an outright basis after the San Mateo, Calif.-based solar company posted results that were weaker than expected, and the company guided lower for the current quarter.

The SolarCity 2.75% convertibles due 2018 traded at 104.96, which was down from about 111, according to Trace data. SolarCity shares were also down 5% to 6%.

The SolarCity 1.625% convertibles due 2019 traded at 88.5.

SunEdison Inc.’s convertibles were in focus after the St. Peters, Mo.-based solar company posted a narrower-than-expected loss for its fourth quarter. The SunEdison shares were up 2%.

In addition, Actavis plc launched an offering of $4.2 billion of mandatory convertible preferred shares that were being marketed together with $4.2 billion of common stock to fund the company’s purchase of Allergan Inc., The mandatories were talked to yield 5.75% to 6.25% with an initial conversion premium of 17.5% to 22.5%.

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