ConMed convertibles give back outright gains; Okta up post-earnings; Novavax below par

By Abigail W. Adams

Portland, Me., June 3 – It was a relatively quiet Friday in the convertibles secondary space as selling returned to equities on the heels of a better-than-expected non-farm payrolls report.

Indexes gave back much of their gains from Thursday’s strong session as investors once again reassess their bets on the Federal Reserve’s rate hike schedule.

The Dow Jones industrial average closed Friday down 349 points, or 1.05%, the S&P 500 index closed down 1.63%, the Nasdaq Composite index closed down 2.47% and the Russell 2000 index closed down 0.77%.

There was $48 million in reported volume about one hour before the market open and $337 million on the tape about one hour before the market close.

ConMed Corp.’s new 2.25% convertible notes due 2027 continued to dominate the tape with the notes giving back some outright gains on a red day for stocks but maintaining their dollar-neutral expansion.

Novavax Inc.’s short-duration 3.75% convertibles due Feb. 1, 2023 again sank below par in active trading.

Okta Inc. was a bright spot with the software company’s convertible notes rising alongside stock after an earnings beat.

ConMed down outright

ConMed’s new 2.25% convertible notes due 2027 continued to see heavy volume their second day in the secondary space with the notes giving back some outright gains.

While down outright, the notes maintained the large dollar-neutral expansion made on debut on Thursday.

The 2.25% convertible notes were down 3 points outright with stock off more than 3%.

They were changing hands at 102.5 versus a stock price of $111.59 in the late afternoon, according to a market source.

The notes were flat dollar-neutral on the move down, maintaining the 2.5-point expansion made during Thursday’s session, a source said.

There was $14.5 million in reported volume about one hour before the market close.

ConMed’s stock traded to a high of $115.48 and a low of $110.57 before closing the day at $111.06, a decrease of 3.97%.

Novavax lower

Novavax’s short-duration 3.75% convertible notes due Feb. 1, 2023 dropped below par in active trading on Friday after the U.S. Food and Drug Administration flagged a risk with the company’s Covid-19 vaccine.

The 3.75% notes fell 1.5 points outright.

The notes were wrapped around 99 heading into the market close with a yield of 5.228%.

Novavax’s stock traded to a high of $50.60 and a low of $41.10 before closing the day at $44.76, a decrease of 20.03%.

Okta’s earnings

Okta’s convertible notes were a bright spot on a heavy day with the notes gaining outright with stock on the rise despite the selling pressure in equities.

Okta’s 0.375% convertible notes jumped 4 points outright with stock up more than 8% early in the session.

The 0.375% notes were changing hands at 87 versus a stock price of $104.79 in the late morning.

Activity in the name tempered as stock came in as the session progressed.

However, the notes were seen changing hands at 86.75 in the late afternoon.

There was $8 million in reported volume.

Okta’s 0.125% convertible notes due 2025 gained 1.25 points outright.

The notes were trading at 94.5 versus a stock price of $103.67 early in the session.

However, they also came in alongside stock and were seen changing hands at 93 versus a stock price of $100.67 in the late afternoon.

There was $6 million in reported volume.

Okta’s stock traded to a high of $111.35 and a low of $98.12 before closing the day at $98.38, an increase of 5.02%.

While unable to hold onto its early gains, stock stayed in the green after an earnings beat.

The company reported losses per share of 27 cents versus analyst expectations of losses of 34 cents.

Revenue was $414.94 million versus analyst expectations for revenue of $388.78 million.

Mentioned in this article:

ConMed Corp. NYSE: CNMD

Novavax Inc. Nasdaq: NVAX

Okta Inc. Nasdaq: OKTA

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