Morning Commentary: New Proofpoint convertible jumps outright, on swap in active trade

By Rebecca Melvin

New York, Aug. 21 – Proofpoint Inc.’s newly priced 0.25% convertibles traded up on Wednesday after the Sunnyvale, Calif.-based cybersecurity company priced an upsized $800 million of the five-year notes at the rich end of coupon talk and midpoint of talk for the premium.

The new Proofpoint convertible was seen printing as high at 104.63 on an outright basis, a New York-based market source said, citing Trace data. Another market source said a late-morning trade was 102 5/8 bid, 103 1/8 offered versus the closing stock price of $111.99, equating to a 2.75-point to 3-point gain on swap.

The volume of the new Proofpoint convertible dwarfed everything else in trade early Wednesday, the first market player said.

The note presented an excellent entry point for investors after the stock fell on Tuesday. The stock has subsequently rebounded, the source said. The stock was last up $4.99, or 4.5%, at $116.99.

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