Valeant Pharmaceuticals takes nosedive on earnings announcement; Concordia continues fall

By Colin Hanner

Chicago, Nov. 8 – Election Day in the United States had equity markets in an upswing as signs of a Hillary Clinton presidential win seemed apparent, yet distressed debt-land responded largely to follow-ups of recent trending names and the final round of earning announcements.

“I wouldn’t say this election is having any macro-effect on distressed,” a trader said. “It’s more focused on company-specific catalysts.”

Valeant Pharmaceuticals International Inc. saw some downward volatility Tuesday.

Valeant posted a $1.22 billion loss for the quarter and cut its adjusted earnings to $5.30 to $5.50 a share on $9.55 billion to $9.65 billion in sales, from estimates of $6.60 to $7 a share and revenue between $9.9 billion and $10.1 billion.

In distressed-debt land, Valeant’s notes were trading down significantly.

“All the bonds were trading multiple times,” a trader said, especially the 7½% notes due 2021, which were down 3½ points to 88½.

On Monday, Concordia International Corp. announced dismal third-quarter results, which resulted in steep declines for some of its notes.

The trend continued Tuesday, though the drops were softer.

Concordia’s 7% notes due 2023 traded down 3 points on “a dozen trades” to a 37½ to 38 handle, several traders said. Those notes were down 6 points during Monday’s trading.

The 9½% notes due 2022 saw movement on “30 trades,” a trader said, and were down 6¼ points to 40¾ to 41 area. Through this week, the notes are down nearly 20 points.

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