Booking convertible notes active; Upstart down outright; Opendoor volatile; Fisker sinks

By Abigail W. Adams

Portland, Me., Aug. 19 – The convertibles secondary space was active on Thursday on a volatile day for equities with benchmarks swinging between large gains and losses before closing the day mixed.

The Dow Jones industrial average closed the day down 65 points, or 0.19%, the S&P 500 index closed the day up 0.13%, the Nasdaq Composite finished up 0.11% and the Russell 2000 index closed down 1.35%.

There was $93 million in reported volume about one hour into the session and $476 million in reported volume about one hour before the market close.

Booking Holdings Inc.’s 0.75% convertible notes due 2025 topped the volume charts with a large buyer in the market.

Upstart Holdings Inc.’s 0.25% convertible notes due 2026 were coming in on an outright basis as stock dipped.

Opendoor Technologies Inc.’s 0.25% convertible notes due 2026 were volatile on an outright basis with the notes down outright early in the session but closing the day flat.

Fisker Inc.’s 2.5% convertible notes due 2026 continued to get pummeled in the aftermarket with the notes dropping to a 93-handle.

Booking active

Booking Holdings’ 0.75% convertible notes due 2025 were among the most actively traded issue in the secondary space on Thursday with a large buyer for the notes in the market.

The 0.75% convertible notes were trading around 137 with $26 million on the tape, a source said.

Booking’s stock traded to a high of $2,092.79 and a low of $2,058.43 before closing the day at $2,075.86, a decrease of 0.5%.

The 0.75% notes have been active over the past week as the travel technology company’s 0.9% convertible notes due Sept. 15, 2021 approach their maturity.

While the two tranches usually trade side by side, the 0.9% convertible notes were not as active on Thursday.

The activity in the 0.75% notes appeared to be the result of a large buyer accumulating a bigger position in the longer duration notes.

Upstart down outright

Upstart Holdings’ 0.25% convertible notes due 2026 remained active their second day in the secondary space with the notes giving back some of their outright gains.

The 0.25% notes were down 3 points outright with stock off more than 8%.

The notes were changing hands at 103 versus a stock price of $193.73 in the late afternoon, according to a market source.

There was more than $20 million in reported volume.

Upstart’s stock traded to a high of $213.99 and a low of $192.51 before closing the day at $193.87, a decrease of 8.67%.

The 0.25% convertible notes skyrocketed on their aftermarket debut on Wednesday with the notes up 6 points outright and 3.75 points to 4 points dollar-neutral.

Opendoor volatile

Opendoor’s 0.25% convertible notes due 2026 were volatile on an outright basis their second day in the secondary space.

The notes traded as low as 96.5 during Thursday’s session. However, they rebounded alongside stock and were wrapped around par in the late afternoon.

While the notes were volatile on an outright basis, they were largely unchanged on a dollar-neutral basis, a source said.

There was about $12 million in reported volume.

Opendoor’s stock traded to a low of $13.81 and a high of $15.10 before closing the day at $14.92, an increase of 3.11%.

The notes were also flat on an outright and dollar-neutral basis on their aftermarket debut on Wednesday.

Fisker under pressure

Fisker’s 2.5% convertible notes due 2026 continued to get pummeled in the secondary space on Thursday.

The notes dropped 4 points outright with stock off more than 4%.

They fell to a 93-handle and were changing hands at 93.125 versus a stock price of $13.26 in the late afternoon, sources said.

Fisker’s stock traded to a high of $14.37 and a low of $13.11 before closing the day at $13.19, a decrease of 7.31%.

Fisker priced a $625 million issue of the 2.5% notes at par on Aug. 12.

While the notes were marketed with assumptions of a 500 basis points over Libor, they now trade with a credit spread over 1,000 bps, a source said.

Mentioned in this article:

Booking Holdings Inc. Nasdaq: BKNG

Fisker Inc. NYSE: FSR

Opendoor Technologies Inc. Nasdaq: OPEN

Upstart Holdings Inc. Nasdaq: UPST

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