Morning Commentary: GNC bonds move up on news of possible sale; Molina Healthcare extends losses

By Rebecca Melvin

New York, May 2 – GNC Holdings Inc.’s 1.5% convertibles due 2020 popped in early trading action on Monday after the Pittsburgh-based specialty health and wellness retailer said it has started looking at strategic options that include a possible sale of the company.

The company has started a “review of a wide range of strategic and financial alternatives,” according to a news release.

GNC’s 1.5% convertibles were up 4 points at 83.17, according to Trace data. GNC shares, which plunged last Thursday on same-store sale declines, were up about 4% in the early going at $25.30.

Elsewhere, Molina Healthcare Inc. looked poised to continue losses for a second straight day after the Long Beach, Calif.-based Medicaid services company posted quarterly earnings that fell well short of estimates on Friday.

The Molina 1.125% convertibles traded at 136.5 early Monday, which was down nearly 2 points on the day. Molina’s 1.125% convertibles dropped 22 points on an outright basis, or about 13%, on Friday against shares that were lower by 19%.

The Molina 1.625% convertibles traded down to 109 on Monday, which was off from 112.5 last on Friday.

Molina shares were down another 6% at $48.60.

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