DISH bonds down following funding reports; Carvana paper extends rally; iHeartMedia up

By Cristal Cody

Tupelo, Miss., June 9 – DISH Network Corp.’s bonds moved lower on Friday in strong trading with its higher-rated junk paper down about ½ point and its paper trading at distressed levels more than 3 points weaker on reports the company is struggling to raise cash to fund its 5G network.

DISH’s 7¾% senior notes due 2026 (B3/B-) fell more than 3 points.

The company’s stock was down 12% on the day.

Carvana Co.’s paper extended Thursday’s rally into Friday but in light trading, while its stock gave back some of the prior session’s gains after the company reported an improved second-quarter outlook.

Carvana’s 5 5/8% senior notes due 2025 (Caa2/CCC-) went out 3½ points better.

In the broader market, stocks stayed positive on Friday ahead of the Federal Reserve’s monetary policy meeting next week, though volatility turned higher, sources said.

The iShares iBoxx High Yield Corporate Bond ETF rose 2 cents, or 0.03%, to $74.72.

The “Fear Factor” index rose Friday but remained at its lowest levels since 2020.

The CBOE Volatility index was 1.32% higher at 13.83.

iHeartMedia, Inc.’s paper also remained stronger.

The 8 3/8% senior notes due 2027 (Caa1/B-) have added about 3¾ points over the last two sessions.

Distressed cable, telecom and media bonds led strong gains in the junk market this week, according to a BofA Securities Inc. note on Friday.

DISH notes decline

DISH DBS Corp.’s 7¾% senior notes due 2026 (B3/B-) fell more than 3 points in strong trading totaling $10.78 million on Friday, a source said.

The bonds were quoted with a 57 bid handle, down from the 61½ bid area a week ago.

The company’s bonds had gained in the prior week following news reports of a potential deal with Amazon.com Inc., which is reportedly holding discussions with wireless carriers to bring mobile telephone services to Prime customers.

DISH’s credit default swap spreads were better this week.

CDS spreads for DISH DBS firmed 135 basis points over the past week ended Wednesday to 2,379 bps, according to a Moody’s Investors Service report.

DISH Network’s CDS spreads tightened 126 bps to 2,109 bps for the past week.

CDS spreads for both DISH DBS and DISH Network improved more than 250 bps in the prior week.

The Englewood, Colo.-based satellite cable operator’s stock (Nasdaq: DISH) closed down 11.84% at $6.55 on Friday.

Carvana improves

Carvana’s 5 5/8% senior notes due 2025 (Ca/C) went out Friday 3½ points better at 89½ bid on $6 million of trading, a source said.

The bonds climbed over 7 points on Thursday on $3.3 million of supply.

Carvana’s 4 7/8% senior notes due 2029 (Ca/C) also were quoted up 4 points at 59¾ bid on $3.8 million of trading on Friday.

The bonds have improved since the company reported Thursday that it expects higher adjusted EBITDA of above $50 million in the second quarter.

In the prior week, Carvana announced that it terminated its exchange offer for five series of notes after the minimum participation condition of $500 million of tendered notes was not met.

Carvana’s stock gave back nearly half of Thursday’s gains when it shot up 56%.

The Tempe, Ariz.-based online car retailer’s stock (NYSE: CVNA) dropped 21.3% on Friday to $19.07.

iHeartMedia moves up

iHeartCommunications, Inc.’s 8 3/8% senior notes due 2027 (Caa1/B-) traded 1¾ points better by the close on Friday after gaining 2 points the previous day, a source said.

The bonds were quoted going out at 70¾ bid on $8.8 million of volume.

The issue has improved more than 10 points this week.

The San Antonio-based media broadcasting company’s stock (Nasdaq: IHRT) closed Friday down 5.85% at $3.54.

Distressed index gains

S&P U.S. High Yield Corporate Distressed Bond index one-day returns hit its highest levels of the week on Thursday at 0.67%, compared to 0.26% on Wednesday, 0.19% on Tuesday and 0.47% on Monday.

Month-to-date total returns improved to 2.84% in the prior session from 2.15% on Wednesday, 1.89% on Tuesday and 1.69% at the week’s start.

Year-to-date total returns climbed to 9.67% on Thursday from 8.94% midweek, 8.65% on Tuesday and 8.45% on Monday.

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