Yahoo! extends hedged gains; Performant Financial nixes convertibles, stock; Illumina busy

By Rebecca Melvin

New York, Jan. 30 – Convertibles were quiet on the last trading day of the month on Friday as market players mostly marked their portfolios and watched the resoundingly strong initial public offering of Shake Shack Inc., sources said.

Yahoo! Inc. was a market focus for much of the week, trading lower on both an outright and dollar-neutral, or hedged, basis on Wednesday after the internet company reported earnings and unveiled a plan to spin off its Alibaba Group Holding Ltd. stake.

Then the Yahoo! bond put in two days of gains for hedged players following disappointing earnings from Alibaba on Thursday and a ratings upgrade for Yahoo! from Evercore ISI on Friday.

Initially, Yahoo! investors appeared cheered by the Alibaba spinoff, but shares sank from initial gains for a 3% decline on Wednesday. They were lower again on Thursday but recovered a bit on Friday.

Performant Financial Corp. withdrew an $80 million offering of convertible senior notes and $50 million of common shares on Friday after the deals went up on the calendar on Wednesday. Performant shares had plunged 28% in the interim.

Illumina Inc.’s 0% convertible due 2019, or the A tranche, was active again in a carryover of trade related to positive earnings the San Diego, Calif.-based genetic sequencing equipment company posted late Tuesday.

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