Booking convertibles in focus; Opendoor, Avalara hit new outright highs; Pinduoduo gains

By Abigail W. Adams

Portland, Me., Sept. 1 – Trading activity in the convertibles secondary space remained light on Wednesday as equities opened September mixed.

The Dow Jones industrial average closed the day down 48 points, or 0.14%, the Nasdaq Composite closed the day up 0.33%, the S&P 500 index closed the day up 0.03% and the Russell 2000 index closed the day up 0.53%.

There was $95 million in reported volume about one hour into the session and $583 million about one hour before the market close.

Booking Holdings Inc.’s convertible notes accounted for nearly one-fifth of the total reported volume on the tape with the end-of-life trade continuing to dominate the tape.

Recent issues were also active with Opendoor Technologies Inc.’s 0.25% convertible notes due 2026 and Avalara Inc.’s 0.25% convertible notes due 2026 hitting their highest outright level since pricing.

Pinduoduo Inc.’s 0% convertible notes due 2025 also improved on an outright basis with the equities of several China-based companies rebounding during Wednesday’s session.

More Booking

Booking Holdings’ convertible notes continued to dominate the tape as the end nears for the company’s 0.9% convertible notes due Sept. 15, 2021.

The 0.9% notes were changing hands just south of 108.375 in the late afternoon.

There was more than $95 million of the bonds on the tape.

The 0.75% convertible notes due 2025 continued to trade around 145 with about $20 million in reported volume.

Booking Holdings’ stock traded to a high of $2,330 and a low of $2,285 before closing the day at $2,286.85, a decrease of 0.56%.

Booking Holdings’ convertible notes have dominated activity in the secondary space for the past few weeks as the notes change hands amid the 0.9% convertible notes’ looming maturity.

New heights

Opendoor’s 0.25% convertible notes due 2026 and Avalara’s 0.25% convertible notes due 2026 hit their highest outright levels since pricing during Wednesday’s session.

Opendoor’s 0.25% convertible notes rose more than 2 points outright with stock up about 2%.

They were changing hands at 114.375 versus a stock price of $18.28 in the late afternoon.

There was more than $12 million in reported volume.

Opendoor’s stock traded to a low of $17.73 and a high of $18.49 before closing the day at $18.42, an increase of 3.89%.

Avalara’s 0.25% convertible notes also gained more than 2 points outright with stock up about 4%.

The notes were changing hands at 106.75 versus a stock price of $187.23 in the late afternoon.

There was about $20 million in reported volume.

Avalara’s stock traded to a low of $179.71 and a high of $188.77 before closing the day at $186.20, an increase of 3.62%.

Both Opendoor’s and Avalara’s convertible notes struggled below par their initial days in the aftermarket but have since improved alongside stock.

Avalara priced a $977.5 million issue of the 0.25% convertible notes and Opendoor priced a $977.5 million issue of the 0.25% convertible notes in mid-August.

The deals were two of the last to price before the primary market went dormant.

Pinduoduo improves

Pinduoduo’s 0% convertible notes were on the rise on an outright basis as the company’s equity posted gains on a strong day for the equities of China-based convertible notes in general.

The 0% notes gained more than 2 points outright as the Shanghai-based e-commerce company’s equity rose over 6%.

The notes were changing hands at 97.625 versus an equity price of $106.55 early in the session.

They continued to trade around 97 in the late afternoon.

There was about $7 million in reported volume.

Pinduoduo’s American Depositary Shares traded to a low of $100.20 and a high of $109.79 before closing the day at $106.83, an increase of 6.81%.

While China’s crackdown on the tech sector has pressured Pinduoduo’s equity and convertible notes over the past two months, the company’s equity has been on an upswing since reporting earnings on Aug. 24.

Wednesday was also a strong day for China-based companies in general as investors bottom fish in the space.

Mentioned in this article:

Avalara Inc. NYSE: AVLR

Booking Holdings Inc. Nasdaq: BKNG

Opendoor Technologies Inc. Nasdaq: OPEN

Pinduoduo Inc. Nasdaq: PDD

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