iHeartCommunications bonds give back gains from post-earnings rally; CSC Holdings mixed

By Abigail W. Adams

Portland, Me., March 5 – It was a weak day for distressed debt credits on Tuesday as a risk-off sentiment swept through markets ahead of Federal Reserve chair Jerome Powell congressional testimony on Wednesday.

Names were lower across the board with lower quality credits taking the brunt of the selling pressure in the high-yield market.

iHeartCommunications, Inc.’s senior notes were under pressure on Tuesday with the notes giving back their gains from a post-earnings rally.

Altice USA Inc. subsidiary CSC Holdings LLC’s senior notes were mixed after surging the previous week on speculation about a Charter takeover.

iHeart gives back

iHeartCommunications’ senior notes were under pressure on Tuesday with the notes giving back gains from their post-earnings rally the previous week.

iHeart’s 5¼% senior secured notes due 2027 (Caa1/B+) were off almost 2 points to return to a 72-handle.

The notes were changing hands at 72½ with the yield about 15 7/8% heading into the market close, a source said.

There was $7 million in reported volume.

The 6 3/8% senior secured notes due 2026 were off 1 to 1½ points.

The notes were trading at 83 7/8 heading into the market close with a yield of 15 3/8%.

iHeart’s stock was also under pressure on Tuesday after an analyst lowered his price target with stock closing the day at $1.93, a decrease of 9.81%.

iHeart’s capital structure rallied strongly post-earnings with the 5¼% senior secured notes shooting as high as 75½.

However, the 5¼% notes are now trading at the level prior to their earnings announcement.

Stock has also retreated to its pre-earnings level.

CSC Holdings in focus

CSC Holdings’ senior notes were weaker in active trade on a soft day for the market.

The 7½% senior notes due 2028 (Caa2/CCC) were unchanged with the notes continuing to trade in the 71¼ to 71¾ context, a source said.

The yield was about 17½%.

There was $10 million in reported volume.

The 5¾% senior notes due 2030 were off ¼ to ½ point with the notes trading in the 58½ to 59 context with the yield 17 1/8%.

The 4 5/8% senior notes due 2030 were also off about ½ point to trade in the 55¼ to 55¾ context.

The yield was 15½%.

While flat to slightly weaker on Tuesday, the notes have largely found their level as the market awaits updates on Charter’s rumored takeover bid for Altice USA.

CSC Holdings’ senior notes surged last week as news hit the market that Charter was considering a takeover of the heavily leveraged telecom.

The 7½% notes have gained 10 points and the 4 5/8% notes have gained 11 points since the news broke last Monday.

Index

The S&P U.S. High Yield Corporate Distressed Bond index was up 0.26% on Monday with the year-to-date return now 3.09%.

The index gained 0.20% on Friday.

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