Junk: StoneX, FirstCash price issues; AAR shoots higher; funds see first outflow of 2024

By Paul A. Harris and Abigail W. Adams

Portland, Me., Feb. 15 – Thursday’s session in the dollar-denominated junk primary market saw StoneX price a $550 million issue of seven-year senior secured second-lien notes (Ba3/BB-) at par to yield 7 7/8%, at the tight end of talk.

Timing was accelerated. When announced Thursday morning the deal was scheduled to remain in the market until Friday.

Also, FirstCash, Inc. priced a $500 million issue of 6 7/8% eight-year senior notes (Ba2/BB) at par, at the tight end of talk.

Meanwhile, the secondary space continued to firm on Thursday with the market recuperating from Tuesday’s post-CPI sell-off

The strong demand for AAR Corp.’s 6¾% senior notes due 2029 (Ba2/BB) seen during bookbuilding followed the notes into the secondary space with the notes shooting higher in heavy volume after a strong break.

TransDigm Inc.’s two tranches of first-lien senior secured notes (Ba3/B+) continued to improve in active trade with the notes now trading at a premium to their issue price.

Outside of new paper, earnings-related news continued to spark large movements in the space.

Avis Budget Group, Inc.’s senior notes (B1/BB-) were again driven lower on Thursday with the notes seeing some selling pressure since their Tuesday earnings report.

High-yield mutual funds and exchange-traded funds saw the first outflow of 2024 with $88.8 million leaving the space in the week through Wednesday’s close.

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