Morning Commentary: Wayfair convertibles eyed as stock tanks; Booking Holdings active

By Abigail W. Adams

Portland, Me., Nov. 1 – The convertible secondary space again saw active trading early in Thursday’s session with convertibles issuers continuing to see large stock moves post earnings and accounts tying up end of the month business.

More than $105 million was on the tape early in the session.

Wayfair Inc.’s 0.375% convertible notes due 2022 were in focus with the notes dropping more than 13 points outright as stock dropped more than 14% after its third-quarter earnings report.

The notes traded as low as 110.625 early Thursday, according to a market source.

More than $11 million of the bonds were on the tape a little over one hour into the session.

Wayfair stock plummeted after the company reported a loss per share of $1.28 versus analyst expectations for a loss per share of $1.09.

While the company missed on its bottom line, revenue beat expectations.

Wayfair reported revenue of $1.71 billion in the third-quarter versus analyst expectations for revenue of $1.67 billion.

Booking Holdings Inc.’s convertible notes continued to lead the volume charts, although focus shifted on Thursday to the company’s 0.90% convertible notes due 2021 from the 0.35% convertibles.

The notes were trading just shy of 116 with $17 million of the bonds on the tape, a market source said.

Booking stock was up about 1% early Thursday to $1,892.33.

Booking’s 0.35% convertible notes due 2020 saw high-volume activity early in Wednesday’s session, although the notes were not active early Thursday.

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