SSR Mining convertible notes in focus on call news; Wayfair active; Dexcom, Insulet gain

By Abigail W. Adams

Portland, Me., Feb. 14 – The convertibles secondary space rounded out an active week quietly.

There was $64 million in reported volume about one hour into the session and $300 million heading into the late afternoon.

SSR Mining Inc.’s 2.875% convertible notes due 2033 were in focus after the Vancouver, B.C.-based mining company announced on Thursday it was calling the issue.

Wayfair Inc.’s convertible notes continued to trade off on an outright basis as stock wavered between gains and losses following news the e-commerce company was laying off 3% of its workforce.

Friday was a strong day for diabetes management equipment makers.

Dexcom Inc.’s 0.75% convertible notes due 2023 were on the rise alongside stock after a fourth-quarter earnings beat.

Insulet Corp.’s convertible notes were improving in kind due to an upbeat forecast for the industry.

SSR Mining’s call

SSR Mining’s 2.875% convertible notes due 2033 were in focus on Friday following news the company was calling the notes.

The 2.875% notes were changing hands just north of 101 with more than $12 million in reported volume, a source said.

SSR Mining announced it would redeem the full outstanding $114.95 million amount of the 2.875% notes at par plus accrued interest on March 30.

Market players were buying the notes above the par call price on the hopes SSR Mining stock would gain and the notes would become convertible prior to their call date, a market source said.

The coupon was covering the bet on the notes becoming convertible.

While above par, the notes were still trading at a slight discount to the amount that would be received at redemption, due to accrued interest, another source said.

SSR Mining, formerly Silver Standard Resources Inc., priced a $265 million issue of the 2.875% notes in 2013.

The notes carry a conversion price of $20.

SSR Mining stock closed Friday at $18.13, an increase of 0.17%.

The company is slated to report earnings on Feb. 20.

Wayfair active

Wayfair’s convertible notes were active and continued to decline on news the home goods e-commerce company was laying off 3% of its workforce.

Wayfair’s 1% convertible notes due 2026 were down about 1 point outright to change hands around 85 on Friday, sources said.

The notes dropped about 6 points outright on Thursday following the layoff announcement.

Wayfair’s 0.375% convertible notes due 2022 were also down about 1 point outright to 104.

The notes were changing hands around 113 heading into Thursday’s session.

Wayfair stock traded to a low of $80.56 and a high of $84.09 before closing the day at $82.46, an increase of 0.48%.

Wayfair stock dropped more than 14% on Thursday.

Stock cratered after the company announced it was laying off 550 employees in an effort to reduce inefficiencies.

The company is scheduled to report earnings on Feb. 28.

Sector surges

Friday was a strong day for the makers of medical equipment for the management of diabetes.

Dexcom’s equity-sensitive convertible notes were on the rise as stock jumped following a fourth-quarter earnings beat.

The 0.75% convertible notes due 2023 gained 20 points outright to trade up to 184.5, according to a market source.

Dexcom stock traded to a low of $275.90 and a high of $295.00 before closing the day at $283.91, an increase of 12.57%.

The maker of glucose monitoring equipment reported earnings per share of $1.15 versus analyst expectations for earnings of 75 cents.

Revenue was $462.8 versus analyst expectations for revenue of $433 million.

Insulet’s stock and convertible notes were gaining in sympathy.

The 1.375% convertible notes due 2024 reached their highest outright level since pricing.

The notes traded up to 230 and were expanded about 0.25 point dollar-neutral.

Insulet stock traded to a low $205.62 and a high of $212.84 before closing the day at $212.32.

Mentioned in article:

Dexcom Inc. Nasdaq: DXCM

Insulet Corp. Nasdaq: PODD

SSR Mining Inc. Nasdaq: SSRM

Wayfair Inc. NYSE: W

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