Community Health active; Vanguard Natural continues losses after Chapter 11; Neiman down

By Colin Hanner

Chicago, Feb. 6 – The weekend did not do much to change the trend in the distressed debt market as of late, with several issues trading tight from their starting handles on Monday.

That included Community Health Systems, Inc., whose most popular distressed security was one of the more active issues of the day though was up only marginally, a trader said.

Pharmaceutical company Valeant Pharmaceuticals International, Inc. followed with a gain.

Vanguard Natural Resources, LLC, which filed for Chapter 11 protection last week, continued to fall in one of its issues, the second-straight session of losses.

Again lacking in volume but changing wildly were a set of Peabody Energy Corp.’s unsecured securities as more news continued to come out of a litigious reorganization period for the bankrupt coal company.

Retailer Neiman Marcus Group, Inc. saw a reoccurring loss in a set of notes as the consensus of traditional retailers continues to be one of negative outlook.

A set of iHeartCommunications, Inc.’s notes were down on the day, GenOn Energy Inc. was one of the day’s biggest losers and several one-off names that have traded recently were not far from where they started.

In health and pharma

A trader said the Franklin, Tenn.-based Community Health Systems’ 6 7/8% notes due 2022 were one of the most active issues of the session, though traded without much movement.

The notes were up 1/8 point to 73 7/8, the trader said.

Though inching into high-yield territory, a market source said Community Health’s 5 1/8% notes due 2021 were up ¼ point to 95.

In pharmaceuticals, Valeant’s 7½% notes due 2021 were up 1 point to 90, according to a market source.

Vanguard Natural sinks

The decision to file for Chapter 11 bankruptcy protection has dealt some blowbacks to Vanguard Natural Resources, and on Monday, the losses kept coming.

The Houston-based oil and gas exploration and development company’s 7 7/8% notes due 2020 were off 1 point to 76½, a trader said.

Before the Chapter 11 announcement, the issues had been trading in the low-to-mid 80s, traders said.

On the session, Vanguard’s stock dropped 10 cents, or 34.71%, to $0.19.

Peabody Energy lower

On the back of a request to extend its exclusive period for filing and soliciting votes on a plan of reorganization, Peabody Energy faced a cry from creditors on Monday.

Following the weekend, a group of creditors filed an emergency appeal against Peabody, according to a Reuters story, the latest in a series of injunctions filed against the St. Louis-based coal company’s restructuring plans.

The claimants say Peabody rushed creditors to support the reorganization plan, which they say is an abuse of bankruptcy law, the story said.

On the day, Peabody’s 6½% notes due 2020 were down about 8 points to a 30½ handle on small volume, a market source said.

Neiman treks lower

The trend of tight ups-and-downs for Neiman Marcus’ 8% notes due 2021 continued on Monday, this time declining ½ point to 60½, a trader said.

Last week, Fitch Ratings said that Neiman was a distressed company that had “seen declines in sales and EBITDA, but liquidity is comfortable in the near term,” adding that mall-based department stores, as well as apparel stores, were going to be at the crux of challenges for traditional retailers’ future.

Heightening the problem is the rise of electronic commerce, which “will account for virtually all retail sales expansion in 2017 and represent nearly one-quarter of retail sales,” the report said.

iHeart posts gain

Media company iHeartCommunications reversed course on Monday after posting a gain in one set of its notes on Friday.

The 9% notes due 2021 were down ½ point to 75½, a trader said, adding they were among the most actively traded issues on the day.

E&P mixed

Two sets of GenOn Energy’s distressed securities had mixed movement on the session, though its 10% notes due 2028 were the more dramatic of the two.

A trader said those notes were down 2 points to 88.

Bucking the losses were GenOn’s 9½% notes due 2018, which were up ¾ point to 77½, a trader said.

Fellow Houston-based exploration and production company Parker Drilling Co.’s 6¾% notes due 2022 were up ½ point to 87, a market source said.

Geophysical service company CGG SA, which a trader said was now trading flat, saw an “almost 2-point gain” in its 6½% notes due 2021.

And Denbury Resources Inc.’s 6 3/8% notes due 2021 were up ¼ point to 92¼, a market source said.

Other movers

After cooling on Thursday’s session, global shipper Navios Maritime Holdings, Inc.’s 7 7/8% notes due 2022 were up ½ point to 71¾, a trader said.

Mortgage banking firm Walter Investment Management Corp.’s 7 7/8% notes due 2021 were down ¼ point to 82½.

And car rental company Hertz Global Holdings, Inc.’s 5½% notes due 2024 were up ¾ point to 86½.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.