Global Payments comes in; Lyft gains on the week; Uber active; MicroStrategy lower

By Abigail W. Adams

Portland, Me., March 22 – The convertibles primary market closed a macro news heavy week with no new issuance; however, sources are predicting an active week ahead.

The Federal Open Market Committee meeting was a barrier to dealmaking over the past week with the market expressing uncertainty about rate cut expectations leading into Wednesday’s announcement.

However, with equity indexes surging to fresh heights and credit spreads tight in the aftermath, sources expect issuers to push through offerings in the week ahead before the quarter draws to a close.

Meanwhile, it was a relatively quiet day in the secondary space on Friday with equity indexes mixed after the strong gains over the past two sessions.

The Dow Jones industrial average closed Friday down 305 points, or 0.77%, the S&P 500 index closed down 0.14%, the Nasdaq Composite index closed up 0.16% and the Russell 2000 index closed down 1.27%.

There was $71 million in reported convertibles trading volume about one hour into the session and $422 million on the tape in the late afternoon.

Global Payments Inc.’s 1.5% convertible notes due 2031 (Baa3/BBB-) were once again the top trader in the space with the notes coming in slightly in heavy volume.

Lyft Inc.’s 1.5% convertible notes due 2025 were among the most actively traded issues with the notes holding the strong gains made the previous session.

Uber Technologies Inc.’s 0.875% convertible notes due 2028 were also active although with little movement in price.

MicroStrategy Inc.’s convertible notes were again moving lower on an outright basis as stock and Bitcoin dipped on Friday.

While the notes have been volatile outright over the past week, they were largely moving in line with stock and were unchanged dollar-neutral.

Global Payments comes in

Global Payments’ 1.5% convertible notes due 2031 were once again the top traded issue in the secondary space with the notes coming in slightly in the heavy volume.

The 1.5% notes were trading at 105.375 versus a stock price of $132.37 in the late afternoon.

They were off about 0.25 point dollar-neutral, a source said.

There was $32 million in reported volume.

Global Payments’ stock traded to a low of $131.90 and a high of $134.89 before closing at $132.13, a decrease of 1.83%.

The $2 billion issue has been a stalwart on Trace since pricing in late February with the notes highly liquid and investment grade, sources said.

Lyft holds gains

Lyft’s convertible notes were holding the gains made over the past few sessions.

The 1.5% notes convertible notes due 2025 were among the most actively traded issues during Friday’s session.

They remained wrapped around 98 with stock off slightly, according to a market source.

There was $18 million in reported volume.

The 1.5% notes gained about 2 points outright the previous session.

Lyft’s more recent 0.625% convertible notes due 2029 were quiet on Friday although they also held the strong gains made over the past week.

The notes were also largely unchanged and trading at 119.25 early in the session after gaining 8 to 9 points outright over the past week.

Both tranches were up about 0.5 point dollar-neutral on the week, a source said.

Lyft’s stock traded to a low of $19.83 and a high of $20.67 before closing at $20.16, a decrease of 0.59%.

While down on Friday, stock rose more than 15% over Wednesday and Thursday as it rallied alongside broader markets post-Fed.

Uber active

Uber’s 0.875% convertible notes due 2028 were active on Friday although with little movement in price.

The notes were trading at 127.375 versus a stock price of $80.11 in the late afternoon, according to a market source.

There was $9 million in reported volume.

Uber’s stock traded to a low of $79.20 and a high of $80.43 before closing at $80.23, up 0.025%.

MicroStrategy lower

MicroStrategy’s convertible notes were lower alongside stock and Bitcoin on Friday.

The 0.625% convertible notes due 2030 were off 3 points outright.

They were trading at 125.75 versus a stock price of $1,527 in the late afternoon, according to a market source.

There was $7 million in reported volume.

The 0.875% convertible notes due 2031 were off 2.5 points outright.

They were trading just shy of 96 versus a stock price of $1,561.

There was $5 million in reported volume.

While the notes have been volatile on an outright basis throughout the week, they have been moving largely in line dollar-neutral.

“They’re really not doing anything,” a source said.

MicroStrategy’s stock traded to a low of $1,490 and a high of $1,594 before closing at $1,523, a decrease of 4.77%.

Mentioned in this article:

Global Payments Inc. NYSE: GPN

Lyft Inc. Nasdaq: LYFT

MicroStrategy Inc. Nasdaq: MSTR

Uber Technologies Inc. NYSE: UBER

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