PBF Energy, Transocean up; AMC notes higher; Envision Healthcare bonds improve

By Cristal Cody

Tupelo, Miss., Jan. 26 – Distressed energy-related bonds saw mostly gains along with oil prices on Wednesday.

PBF Energy Inc.’s senior notes (Caa1/B/B-) traded about 1½ points to nearly 2½ points better.

Transocean Inc.’s 7¼% notes due 2025 (Ca/CC) traded 2 points higher.

West Texas Intermediate crude oil benchmark futures for March deliveries settled up $1.75 at $87.35 a barrel.

Measured market volatility increased less than 2% on the day but remained high at 31.74 by the close Wednesday, compared to the 17 range at the start of January.

Stocks were mixed, and the junk space softened after the Federal Reserve left the target range for the Federal Funds rate unchanged while also reporting hikes are likely soon.

The iShares iBoxx High Yield Corporate Bond ETF shed 29 cents to end at $84.81 after declining 25 cents in the prior session.

AMC Entertainment Holdings, Inc.’s 10% senior secured second-lien notes due 2026 (Ca/CCC-) jumped 2 1/8 points in strong trading action on Wednesday after softening 1 5/8 points in the first two sessions of the week.

In the health care space, Envision Healthcare Corp.’s 8¾% senior notes due 2026 (Ca/CC) rose 1½ points.

Looking at China’s distressed property developer space, Agile Group Holdings Ltd.’s 5¾% senior notes due 2025 (B) rallied 7½ points over the day.

The number of global “weakest links” fell to 207 by Dec. 31, the lowest level since April 2019 and down 57% from December 2020 on improved earnings and financing conditions, S&P Global Ratings said in a news release on Wednesday.

The media and entertainment and consumer sectors accounted for nearly half of all weakest links of issuers rated B- or lower, according to the release.

Asia-Pacific continues to be the region with the highest speculative-grade negative bias at 24%, S&P said.

PBF notes up

PBF’s 7¼% senior notes due 2025 (Caa1/B/B-) jumped nearly 2½ points to 81 bid on more than $6 million of issues traded over the day, a source said Wednesday.

The energy company’s notes were seen about 1½ points to nearly 2½ points better on the day.

PBF’s 6% senior notes due 2028 (Caa1/B/B-) rose 1½ points to trade near the 71 bid area on $4.25 million of secondary supply on Wednesday.

The Parsippany, N.J.-based petroleum refiner’s notes have been active since Morgan Stanley earlier in the month raised the company’s stock price objective to $20 from $17.

Transocean higher

Transocean’s 7¼% notes due 2025 (Ca/CC) traded 2 points better on Wednesday at 81 bid by the close with volume hitting $3 million, a source said.

The Vernier, Switzerland-based offshore driller’s paper has seen strong trading action over the week.

AMC up over 2 points

AMC’s 10% senior secured second-lien notes due 2026 (Ca/CCC-) rose 2 1/8 points on Wednesday to 94¾ bid on $16 million of paper traded, a source said.

The bonds have been heavily traded over the week with the issue down 5/8 point on Tuesday on $26 million of secondary volume and off 1 point on Monday on $20 million of supply.

The Leawood, Kan.-based movie theater owner reported in January that the company is considering refinancing debt in 2022.

Envision Health gains

Envision Healthcare’s 8¾% senior notes due 2026 (Ca/CC) rose 1½ points to 52½ bid over the day after softening in the prior session, a source said.

The issue saw $1 million of secondary volume.

The notes are flat from Monday after declining over 3½ points in the prior week.

The issue is down from a 90 handle in September.

Nashville-based Envision is a health care company and hospital-based physician group.

Agile notes jump

Agile Group’s 5¾% senior notes due 2025 (B) climbed 7½ points in secondary trading on Wednesday to head out at 45 bid, a source said.

About $4.4 million of paper changed hands.

The Guangzhou, China-based property developer’s issue is down from the 69 bid range in December.

Distressed index improves

Distressed index returns narrowed declines on Tuesday but remained soft year to date.

The S&P U.S. High Yield Corporate Distressed Bond index’s one-day total return posted at minus 0.05%, better than minus 0.78% on Monday and minus 1.08% on Friday.

Month- and year-to-date index returns were weaker at minus 1.18%, compared to minus 1.13% on Monday and minus 0.35% on Friday.

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