Rite Aid distressed bonds down; DISH paper declines; Cox Media notes active, lower

By Cristal Cody

Tupelo, Miss., Sept. 26 – Rite Aid Corp.’s 8% senior secured notes due 2026 (Caa3/CCC-/B) slid 2¼ points out of the gate on Tuesday and went out about 3 points lower on the day.

The issue was quoted Monday up 1 point following a Wall Street Journal report late Friday that the retailer is negotiating a bankrupting filing.

Meanwhile, Rite Aid’s stock (NYSE: RAD) took back some of Monday’s losses on Tuesday.

The distressed space along with the junk market was softer over the session, sources reported.

“Everything is down,” a trader said. “My head is spinning from the market.”

Equities slid at the start of the session and finished lower as volatility ramped up.

The S&P 500 index closed down 1.47%, while the Nasdaq dropped 1.57% and the iShares iBoxx High Yield Corporate Bond ETF fell 32 cents, or 0.43%, to $73.58.

The CBOE Volatility index jumped 12.07% to 18.94 in its highest close since May 25.

Bonds in the distressed and junk cable and satellite spaces were under pressure on Tuesday in heavy secondary action, a source reported.

DISH Network Corp.’s bonds gave back ½ point to over 1 point in one of the most active names seen.

The 7¾% senior notes due 2026 (Caa2/B-) fell ½ point by the close.

An issue from Cox Media Group Inc. saw the heaviest trading action over the session.

The 8 7/8% senior notes due 2027 (Caa1) dropped about ¾ point to 78¼ bid on $15.8 million of trading on Tuesday, a source said.

The notes were issued in 2020 by Terrier Media Buyer, Inc., doing business as Cox Media Group.

Rite Aid drops

Rite Aid’s 8% senior secured notes due 2026 (Caa3/CCC-/B) slid 2¼ points in early trading and went out about 3 points lower on the day, according to market sources.

The notes were down over 2 points over the morning at 59 bid and went out even lower at 58¼ bid, but trading was light.

Volume totaled $2 million.

The issue was quoted on Monday up 1 point at 61¼ bid following a Wall Street Journal report late Friday that the retailer is negotiating a bankrupting filing that would include liquidating the bulk of its more than 2,300 stores.

Rite Aid also is facing an opioid-related complaint announced March 13 from the Department of Justice that the drugstore chain knowingly filled unlawful prescriptions for controlled substances.

The Camp Hill, Pa.-based drugstore chain’s stock (NYSE: RAD) took back some of Monday’s losses. Shares were up 9.8% at 43 cents. The stock plunged 33.9% on Monday to a close of 39 cents.

DISH bonds slip

DISH DBS Corp.’s 7¾% senior notes due 2026 (Caa2/B-) fell ½ point by the close on Tuesday to a quote of 76½ bid on more than $13.65 million of secondary activity, a source said.

The company’s 5 1/8% senior notes due 2029 (Caa2/B-) also went out more than 1 point lower on a 56 bid handle. Trading totaled $5.34 million.

DISH Network’s shares declined 7.44% over the day to $5.72.

The Englewood, Colo.-based satellite cable operator’s bonds have been volatile since the company announced plans to merge with EchoStar in August.

Distressed returns soft

The S&P U.S. High Yield Corporate Distressed Bond index saw weak one-day total returns on Monday.

Returns were at minus 0.09%, down from 0.15% on Friday and 0.05% in the same session last week.

Month-to-date total returns moved down to 1.02% versus 1.11% ahead of the weekend and 1.8% in the week-ago session.

Year-to-date distressed total returns softened on Monday to 18.32%, compared to 18.43% on Friday and 19.23% the same day a week ago.

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