Convertibles secondary firms; Wayfair, Akamai rebound; Workiva struggles continue

By Abigail W. Adams

Portland, Me., Aug. 16 – The convertible secondary space was active early in Friday’s session as equity markets rebounded after a volatile week.

However, volume slowed into the afternoon as trading activity surrounding recent deals tempered.

There was $99 million in reported volume on the tape a little over one hour into Friday’s session and about $284 million in the mid-afternoon, sources said.

The deals to price over the past week were in focus.

Akamai Technologies Inc.’s 0.375% convertible notes due 2027 were the top movers in the secondary space with the notes broaching par after trading well below over the past two sessions.

Wayfair Inc.’s recently priced 1% convertible notes due 2026 were also active with the notes rebounding alongside stock.

However, Workiva Inc.’s 1.125% convertible notes due 2026 continued to struggle in secondary trading with the enterprise software company’s stock still floundering despite an up day for the market.

While the secondary space firmed on Friday, liquidity was thin with many on the sidelines trying to gauge the future direction of the market, sources said.

Akamai touches par

Akamai Technologies’ newly priced 0.375% convertible notes due 2027 again dominated activity in the secondary space on Friday.

The notes were broaching par for the first time since hitting the market on Wednesday.

After closing Thursday at 98.25, the 0.375% notes were changing hands just shy of 99 early in Friday’s session, according to a market source.

They traded as high as 99.875 in the mid-afternoon.

More than $34 million of the bonds were on the tape by the mid-afternoon.

Akamai stock traded as high as $87.14 before closing the day at $86.65, an increase of 1.93%.

Akamai’s $1 billion offering of the 0.375% notes hit the secondary space on Wednesday as equities saw their worst sell-off of the year.

While the notes were holding on hedge, they sank on an outright basis to a 97 handle their initial days in the market.

However, sources were confident the notes would recover alongside the broader market and would soon be trading above par.

Wayfair rebounds

Wayfair’s 1% convertible notes due 2026 were also on the rebound in active trading on Friday.

After closing Thursday at 99.75, the 1% notes were up almost 2 points outright on Friday.

They were changing hands at 101.5 early in the session and continued to improve into the afternoon. The notes were up to 101.75 in the mid-afternoon, another source said.

The notes were active with more than $15 million in reported volume early in the session.

Wayfair’s 1.125% convertible notes due 2024 continued to trade with the notes also gaining ground.

They also rose about 2 points outright to 119.5 during Friday’s session.

After a brutal sell-off over the past two session, which saw stock fall by 14%, Wayfair was on the mend on Friday.

Stock closed Friday at $110.42, an increase of 2.87%.

Workiva struggles

While the overall market was gaining ground on Friday, Workiva’s newly priced convertible notes and stock continued to struggle.

The 1.125% convertible notes were trading in the low 97 range but dropped to a 96 handle as the afternoon progressed, sources said.

While Workiva stock struggled in intraday trading, it closed the day relatively unchanged.

Stock traded down to $49.70 before closing Friday at $50.01, a decrease of 0.1%.

Mentioned in this article:

Akamai Technologies Inc. Nasdaq: AKAM

Wayfair Inc. NYSE: W

Workiva Inc. NYSE: WK

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