Nabors, WisdomTree on tap; Affirm, TechTarget convertibles lower; CyberArk volatile

By Abigail W. Adams

Portland, Me., Feb. 9 – The convertibles primary market leapt into action with two overnight deals set to price shortly after launching.

WisdomTree Inc. plans to price $130 million of long five-year convertible notes after the market close on Thursday with price talk for a coupon of 5.625% to 6% and a fixed initial conversion premium of 60%, according to a market source.

Oppenheimer& Co. Inc. is the bookrunner for the Rule 144A offering, which carries a greenshoe of $20 million.

Nabors Industries Ltd. plans to price $200 million of long six-year exchangeable notes after the market close on Thursday with price talk for a coupon of 1.5% to 2% and an initial exchange premium of 20% to 25%, according to a market source.

Goldman Sachs & Co. LLC, Wells Fargo Securities LLC, Morgan Stanley & Co. LLC, Citigroup Global Markets Inc. and HSBC Securities (USA) Inc. are bookrunners for the Rule 144A offering, which carries a greenshoe of $30 million.

Meanwhile, activity in the secondary space slowed on Thursday with equities volatile as investors weighed earnings, a higher-than-expected weekly unemployment number, and Treasury yields that were flashing a strong recession warning.

Indexes gave up all gains from a strong open to close the day in the red with the Dow Jones industrial average closing Thursday down 248 points, or 0.73%, the S&P 500 index closing down 0.88%, the Nasdaq Composite index closing down 1.02% and the Russell 2000 index closing down 1.39%.

There was $68 million in reported convertibles trading volume about one hour into the session and $460 million about one hour before the market close with earnings-related news the driver of activity in the space.

Affirm Holdings Inc.’s 0% convertible notes due 2026 were in focus with the notes falling as stock crumbled post-earnings.

TechTarget, Inc.’s 0% convertible notes due 2026, an off-the-run issue that rarely makes an appearance on the tape, were lower in heavy volume on the heels of its earnings report.

CyberArk Software Ltd.’s 0% convertible notes due 2024 were volatile on an outright basis alongside stock after the information security company reported earnings.

Affirm’s earnings

Affirm’s 0% convertible notes due 2026 were the name of the day on Thursday with the notes falling on an outright and dollar-neutral basis as stock crumbled post-earnings.

While the notes were lower, they pared their losses as the session progressed.

The 0% notes fell 4 points outright early in the session with the notes wrapped around 62 and the yield north of 12.5%, a source said.

However, they pared their losses as the session progressed with the notes off 1 point outright by the late afternoon.

The notes were changing hands at 65.125 versus a stock price of $13.20, a source said.

The yield was about 11.75%.

The notes were the most actively traded issue during Thursday’s session with $28 million in reported volume.

Affirm’s stock traded to a low of $12.52 and a high of $14.33 before closing at $13.29, a decrease of 17.04%.

Stock sank after the buy now pay later firm announced earnings that fell short of expectations.

Affirm announced losses per share of $1.08 versus the losses of 99 cents expected on revenue of $399.56 million versus the $416.11 million expected.

The company also announced that it was laying off about 19% of its workforce.

Affirm’s 0% convertible notes have made large gains amid the market rally over the past one and a half months.

The notes were trading on a 55-handle in early January.

The notes climbed more than 4 points outright in the post-Fed surge in growth stocks the previous week.

TechTarget lower

TechTarget’s 0% convertible notes due 2026 were lower as stock fell double digits following earnings.

The 0% convertible notes were down 1 point outright with stock off more than 10%.

The notes were seen at 79.25 versus a stock price of $42.54 in the late afternoon.

The yield was about 6.125%.

There was $18 million in reported volume.

TechTarget’s stock traded to a low of $38.89 and a high of $47.50 before closing at $41.83, down 15.26%.

The marketing company serving the tech sector beat on both the top and bottom lines with earnings per share of 68 cents versus analyst expectations for earnings per share of 54 cents and revenue of $73.04 million versus the $71.46 million expected.

However, stock sank on weak guidance with the company projecting revenue of $56 million to $58 million versus the $65 million expected.

CyberArk volatile

CyberArk’s 0% convertible notes due Nov. 15, 2024 were volatile alongside stock in active trade on Thursday.

The 0% convertible notes jumped higher with stock up more than 9% out of the gate.

They traded as high as 117.625 versus a stock price of $156.968 shortly after the opening bell.

However, the fell outright as stock gave back all gains and turned negative.

The 0% notes were trading at 112.375 versus a stock price of $145.80 in the late afternoon.

There was $13 million in reported volume.

CyberArk’s stock traded to a high of $162.89 and a low of $143.57 before finishing at $145.30, off 2.63%.

Stock was volatile after the identity-management information security company reported earnings.

While the company beat on the bottom line with earnings per share of 16 cents versus analyst expectations for earnings of 12 cents, it missed on the top with revenue of $169.15 million versus the $174.08 million expected.

Mentioned in this article:

Affirm Holdings Inc. Nasdaq: AFRM

CyberArk Software Ltd. Nasdaq: CYBR

TechTarget, Inc. Nasdaq: TTGT

Nabors Industries Ltd. NYSE: NBR

WisdomTree Inc. NYSE: WT

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