Priceline convertible better ahead of earnings; Whiting rises as investors digest earnings

By Stephanie N. Rotondo

Seattle, July 29 – Convertible bond market players were focused on month-end activities, a trader reported Friday.

As such, it was “all the same names that trade every day.”

Priceline Group Inc.’s paper was trading actively and better as the market prepares for the company’s earnings release next week.

The 1% convertible notes due 2018 started the day at 146.5, which was about a point better from Thursday’s closing level. By the bell, the issue had ticked up to trade with a 147 handle.

The 0.35% convertible notes due 2020 were also on the rise, adding about a point to close in the 121 area, according to a market source.

The stock meantime saw a sizable rise, gaining $24.71, or 1.86%, to close at $1,350.81.

Whiting Petroleum Corp. was another active name, a trader said, as the market continued to digest the company’s earnings release late Wednesday.

The 1.25% convertible notes due 2020 pushed up to 85.5 from 83.75, a source said.

The equity was also better, rising 53 cents, or 7.75%, to $7.37.

For the quarter, Whiting reported a net loss of $301 million, or $1.33 per share. That compared to a loss of $149.3 million, or 73 cents per share, the year before.

On an adjusted basis, the company posted a loss of 70 cents per share. Analysts polled by Thomson Reuters had predicted a loss of 46 cents per share.

Production declined 22% during the quarter to 12.2 million barrels of oil equivalent.

Despite the wider loss and missed expectations, there were some bright spots in the company’s latest results.

First of all, the Denver-based oil and gas producer said it had inked a well-participation agreement – the second so far this year – that would allow the company to drill 30 additional wells this year, but at a fraction of the cost.

Secondly, as oil prices have rebounded a bit from the beginning of the year, Whiting said it was able to add another $50 million to its capital expenditure budget.

And last but not least, there was the announcement of a $300 million asset sale. The company said it had sold off its North Ward Estes property in Texas.

In addition to the purchase price, the company could receive a contingency payment of up to $100 million over the next two years, depending upon how the price of oil performs.

Mentioned in this article:

Priceline Group Inc. Nasdaq: PCLN

Whiting Petroleum Corp. NYSE: WLL

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