Ionis down in active trade; Nabors off; Illumina in line as investors eye earnings

By Rebecca Melvin

New York, Oct. 24 – Ionis Pharmaceuticals Inc.’s convertibles were down in active trading on Tuesday as shares of the Carlsbad, Calif.-based developer of gene-based drugs stumbled 12.4%.

The Ionis 1% convertible notes due 2021 were seen at 112 versus an underlying share price of $56.20. But shares closed lower at $55.01, which was down $7.79.

Ionis “is pretty active because of the stock,” a New York-based trader said.

Ionis’ webcast on third-quarter results and pipeline progress is set for Nov. 7.

Also trading lower in the early going was Nabors Industries Ltd. on loss of its investment-grade status, the trader said.

The Nabors convertibles were seen down by about 0.75 point at 77.5 bid, 77 offered versus shares of the Hamilton, Bermuda-based land-based and offshore oil and gas services company, which were steady at $6.40.

The convertible has been pretty volatile, the trader said of Nabors.

Illumina Inc.’s convertibles were trading in line on a dollar-neutral, or hedged, basis ahead of the San Diego-based biotechnology company’s quarterly results, which were released after the market close.

The Illumina 0% convertible notes due 2019 were seen at 107.875 versus an underlying share price of $210.00, a New York-based trader said.

“Investors are getting ahead of the earnings and positioning,” the trader said.

Illumina equity was unchanged in after-hours trading action after slipping 73 cents, or 0.4%, to $210.82 during the regular session.

The company reported third-quarter non-GAAP net income of $163 million, or $1.11 per share, compared to $144 million, or $0.97 per share, for the third quarter of 2016. Revenue was $714 million, an 18% increase compared to $607 million in the third quarter of 2016.

It now projects about 13% revenue growth from fiscal 2016, and non-GAAP earnings per share of $3.73 to $3.78. The company previously projected about 12% revenue growth; and non-GAAP earnings per share of $3.60 to $3.70.

Wayfair Inc.’s 0.375% convertible senior notes due 2022, which priced on Sept. 11, were also trading down in line with the underlying shares of the Boston-based home décor company.

The shares were trading down a little more than the broader market on no particular news, a market source said.

The Wayfair bonds were seen at 96 bid, 96.5 offered versus an underlying share price of $66.15.

Meanwhile, Jefferies Group Inc.'s 3.875% convertibles due 2029, which are convertible into Leucadia National Corp., are putable soon and traded at 100.25 bid, 100.30 offered.

Mentioned in this article:

Illumina Inc. Nasdaq: ILMN

Immune Pharmaceuticals Inc. Nasdaq: IMNP

Ionis Pharmaceuticals Inc. Nasdaq: IONS

Jefferies Group Inc. NYSE: JEF

Leucadia National Corp. NYSE: LUK

Nabors Industries Ltd. NYSE: NBR

Wayfair Inc. NYSE: W

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