Rite Aid goes sideways after sales report; Dynegy paper firms, TXU unchanged; Avaya debt slips

By Stephanie N. Rotondo

Portland, Ore., March 31 - Distressed debt was firm as the market dealt with month-end pricing on Thursday, traders reported.

"Almost everything was up and certainly there wasn't very much that was down," a trader said.

"Quarter-end does skew everything," he added, noting that while many were "juggling around positions," overall volume was still muted. He added that he expected Friday to continue to be on the quiet side, with action possibly picking up next week.

Rite Aid Corp. released its monthly sales report Thursday and a trader said there was "a lot of activity" in the credit, but "not a lot of movement." He added that the results were "bang on expectations."

Meanwhile, a trader said Dynegy Inc. paper was "really active" and better, though there was no news out. Conversely, Energy Future Holdings Corp. - which had been active on Wednesday - was quieter and about unchanged.

Rite Aid goes sideways

Rite Aid posted a 0.1% decline in same-store sales for the four weeks ending March 26.

A trader said the results were in line with what the market was expecting, resulting in "sideways" movement for the company's bonds.

He saw the 7½% notes due 2017 closing at par bid, par ¼ offered, on $40 million to $50 million traded.

Another trader pegged the 7½% notes at "par and change" and the 9½% notes due 2017 at 893/4, "up a quarter, maybe."

For the month, the Camp Hill, Pa.-based drugstore chain saw its total sales fall 0.9% to $1.95 billion from $1.97 billion the year before.

Prescription revenue accounted for nearly 70% of total sales.

Rite Aid is expected to release quarterly numbers next week.

Dynegy trading up

A trader said Dynegy was "really active," seeing its 7¾% notes due 2019 gaining half a point to 78.

Another market source called the issue a point better at 78 bid.

There was no news out on the Houston-based power producer. However, earlier in the week, Moody's Investors Service dropped Dynegy further into junk, changing the rating to Caa3 from Caa1.

The outlook is negative.

Also in the energy space, Energy Future - or TXU, as it is more commonly referred to - was unchanged, to up slightly, according to a trader.

The 10% notes due 2020 were "right where it was" around 106, while the 10¼% notes due 2015 inched up half a point to 583/4.

Avaya slips, Solo Cup steady

Also mentioned by market sources, a trader said Avaya Inc. was the day's most active bond "by far."

He said the bonds traded down half a point to 1½ points, the 10 1/8% notes due 2015 at 101½ and the 9¾% notes due 2015 at 102.

"I don't know why they trade so rich," he said, noting that both issues were CCC-rated.

The trader also said that Solo Cup Co.'s 8½% notes due 2014 were "kind of unchanged" around 893/4.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.