Michaels notes higher; Transocean down; Nine Energy gives back; Envision Healthcare up

By Cristal Cody

Tupelo, Miss., March 29 – Distressed retail bonds from Michaels Cos., Inc. saw the bulk of secondary action over Tuesday’s session.

Michaels’ 7 7/8% senior notes due 2029 (B3/CCC+) were 2½ points higher with the paper the most active distressed issue traded, a market source said.

Energy paper at the distressed level, including Transocean Inc.’s notes, softened about ¼ point to ½ point in lighter secondary trading, a source said.

Nine Energy Service, Inc.’s 8¾% notes due 2023 (Caa3/D) have given back some of the gains made at the start of the month.

Oil prices softened about $2 after declining around $8 at the start of the week.

West Texas Intermediate crude oil benchmark futures for May delivery, which settled Monday $7.94 lower, declined $1.72 on Tuesday to $104.24 a barrel.

Volatility continued to decline with the Chicago Board Options Exchange’s CBOE Volatility index 4.33% lower at 18.78 after falling below 20 on Monday.

The iShares iBoxx High Yield Corporate Bond ETF jumped $1.01 to close at $82.84.

In the market for distressed health care bonds, Envision Healthcare Corp.’s 8¾% senior notes due 2026 (Ca/CC) improved about ¼ point after climbing 1¾ points in Monday’s session.

Michaels quoted up

Michaels’ 7 7/8% senior notes due 2029 (B3/CCC+) were quoted trading 2½ points better at 85¾ bid on Tuesday in strong trading supply, a source said.

The distressed notes were the most active seen over the day with $23 million of paper traded.

The Irving, Tex.-based craft retailer’s notes have softened from the 98 bid range at the start of 2022.

Nine Energy dips

Nine Energy's 8¾% notes due 2023 (Caa3/D) shed ¼ point in light trading totaling $3 million on Tuesday, a market source said.

The notes were quoted ending the session at 56¾ bid.

Nine Energy’s issue climbed over 13 points in early March after the company reported higher fourth-quarter revenue and lower quarterly losses, trading at 61¼ bid on March 8.

The Houston-based oilfield services company also reported it has submitted a plan to the New York Stock Exchange’s listings committee to regain compliance and avoid delisting of its stock.

The NYSE notified the company in January that it was not in compliance with listing standards.

Envision better

Envision Healthcare’s 8¾% senior notes due 2026 (Ca/CC) improved about ¼ point more on Tuesday to head out at the 48¼ bid area, a source said.

The notes traded 1¾ points higher on Monday.

Nashville-based Envision is a health care company and hospital-based physician group.

Distressed returns off

The S&P U.S. High Yield Corporate Distressed Bond index one-day total return softened to minus 0.18% on Monday.

The one-day return was 0.19% on Friday and 0.08% in the same session a week ago.

Month-to-date total returns widened to minus 2.57% from minus 2.39% on Friday but were improved from minus 3.04% in the week-ago session.

Year-to-date index returns were at minus 5.83% on Monday, compared to minus 5.66% on Friday and minus 6.29% the same day a week ago.

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