Midday Commentary: Charter Communications' climb continues; names gyrate on earnings

By Paul Deckelman

New York, April 23 - Charter Communications Inc.'s new $1 billion offering of 5¾% notes due 2024 continued to gain in morning trading on Tuesday, high-yield traders said.

One of the traders quoted that issue as having firmed to 101¼ bid, 101¾ offered.

That was up from closing levels Monday of around 100 7/8 bid, 101¼ offered.

Charter, a Stamford, Conn.-based provider of cable television, phone and broadband service, priced its drive-by megadeal at par on Friday afternoon via its COO Holdings, LLC and COO Holdings Capital Corp. subsidiaries, but it came too late in the day for any aftermarket dealings at that time. The bonds initially hovered just a little above issue when they were freed for aftermarket dealings on Monday but firmed later on in Monday's session.

The trader also saw Friday's other new issue - Italian telecommunications operator Wind Telecomunicazioni SpA's 6½% senior secured notes due 2020 - at 103¼ bid, 103¾ offered early Tuesday.

The company's Wind Acquisition Finance SA unit priced $550 million of the notes on Friday at par after upsizing the issue from $400 million initially. That tranche was part of a quick-to-market, two-part, dual currency deal that also included €150 million senior secured floating-rate notes due 2019.

The bonds had been quoted bid at 102¼ late Friday, but with no right side immediately seen. On Monday, they had moved up to 102 7/8 bid, 103 1/8 offered going home.

A second trader agreed that "Wind was stronger, and Charter also."

The trader also said that Netflix Inc. paper looked stronger after the movie and television programming rental concern reported strong quarterly earnings, but said that AK Steel Corp. - whose bonds slid on Monday ahead of Tuesday's release of results - "continued weak."

Overall, the KDP High Yield Daily index firmed to 75.68 at mid-morning, up 5 basis points from Monday's close, while its yield came in by 1 bp to 5.42%.

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