Michaels’ distressed retail notes climb; DISH paper mostly up; Grubhub bonds decline

By Cristal Cody

Tupelo, Miss., June 27 – Distressed trading picked up Tuesday with paper from Michaels Cos, Inc. rallying as much as 2¼ points over the session.

Michaels’ 7 7/8% senior notes due 2029 (Caa2/CCC) went out 1½ points better on the day.

Stocks bounced back on Tuesday with indices all higher.

The Nasdaq rose 1.65%.

However, that may change over the back half of the year, Confluence Investment Management analysts said in a note on Tuesday.

“Since we continue to believe the economy is likely to slip into recession in the second half of the year, we would not be surprised if the U.S. stock indexes stage a significant retreat in the coming months,” according to the report.

The iShares iBoxx High Yield Corporate Bond ETF improved 25 cents, or 0.34%, to $74.48.

Market volatility subsided over the session after increasing more than 6% on Monday.

The CBOE Volatility index dropped 3.44% to 13.76.

DISH Network Corp.’s paper also was mostly up about ½ point to 1 point by the day’s close.

Grubhub Holdings Inc.’s 5½% senior notes due 2027 (B3/B-) came under renewed pressure on Tuesday after softening in the prior week.

The issue was down 2 points.

Michaels paper jumps

Michaels’ 7 7/8% senior notes due 2029 (Caa2/CCC) went out 1½ points better on the day at 67¾ bid, a source said.

Another source saw the notes trading 2 points to 2¼ points higher on Tuesday at 68¾ bid.

The retailer’s 5¼% notes due 2028 (B2/B-) improved 1¼ points by the day’s end to a quote of 80¼ bid.

The Irving, Tex.-based arts and crafts retailer was taken private in 2021 by funds managed by Apollo Global Management, Inc. affiliates.

DISH mostly better

DISH DBS Corp.’s 7¾% senior notes due 2026 (B3/B-) traded nearly 1 point higher on Tuesday at 59¼ bid, a market source reported.

DISH’s 5 7/8% senior notes due 2024 (B3/B-) went out mostly flat on an 86 bid handle.

The 7 3/8% senior notes due 2028 (B3/B-) improved nearly ½ point to the 52½ bid range.

The Englewood, Colo.-based satellite cable operator’s stock (Nasdaq: DISH) was up 5.81% at $6.37.

Grubhub sinks

Grubhub Holdings’ 5½% senior notes due 2027 (B3/B-) dropped 2 points to 57¾ bid by the end of the session, a source said.

The notes have slipped further since it was seen trading 1½ points lower on Thursday at 60 bid.

Grubhub chief executive officer Howard Migdal announced on June 12 the food delivery and online order company planned to lay off around 15% of employees, or approximately 400 positions.

Grubhub became part of the Amsterdam-based Just Eat Takeaway.com portfolio of brands in 2021.

Distressed returns soft

S&P U.S. High Yield Corporate Distressed Bond index one-day total returns stayed soft on Monday at minus 0.17%.

Returns were up from minus 0.65% on Friday.

Month-to-date total returns decreased to 3.51% at the week’s start from 3.68% going into the weekend.

Year-to-date distressed total returns fell to 10.39% in the prior session from 10.57% on Friday.

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