Macy’s gains on earnings beat; AMC, National CineMedia climb on NYC reopening; RentPath loans soar on Redfin bid – Mid-Day Commentary

Macy’s bonds and shares strengthened today after the company reported a fiscal fourth quarter earnings beat, according to a trader and a sellsider. 

For the three-month period ended 31 January, the retailer clocked in USD 6.78bn in revenue, beating consensus estimates of USD 6.48bn, but signaling a 18.7% drop from USD 8.34bn recorded year-over-year. The quarter marked Macy’s third consecutive quarter of sequential improvement and was driven by 19% growth in its digital sales from 4Q19.

Comparable sales slid 17% on an owned basis and 17.1% on an owned-plus-licensed basis. Meanwhile, consensus estimates called for a 23% decline in overall comparable sales. Adjusted EBITDA for the quarter fell 32% YoY to USD 789m. 

Macy’s USD 250m 5.125% senior unsecured notes due 2042 popped to 83.5 with a 6.59% yield today, from 81.7 to yield 6.774% yesterday, according to MarketAxess. Its USD 250m 4.3% senior unsecured notes due 2043 edged up to 76 to yield 6.339%, from trades at 74.5 to yield 6.495% on 18 February. 

The retailer’s equity rose to USD 15.77 per share and a market cap of USD 4.896bn, up 3.04% from yesterday’s close.

Bonds and equity for movie theater chains saw an uptick this week after Governor Andrew Cuomo gave the greenlight for cinemas in New York City to reopen on 5 March at a 25% reduced capacity. The city is the country’s second largest moviegoing market, behind Los Angeles.

National CineMedia‘s USD 200m 5.75% senior unsecured notes due 2026 firmed today to 85.3 to yield 9.2% from 84 to yield 9.5% yesterday and 81 at the start of the month, according to MarketAxess. Meanwhile, its USD 400m 5.875% senior secured notes due 2028 are also up since the start of February, last trading at 92.25 yesterday to yield 7.2%, from 91.25 to yield 7.2% on 2 February.

National CineMedia’s stock traded at USD 4.84 today for a market cap of USD 374m, up 3.6% from yesterday’s close.

AMC Entertainment’s benchmark USD 1.5bn 12% second lien notes due 2026 leapt to 73.5 to yield 20% from 68.8 to yield 22% on 19 February, according to MarketAxess.

AMC’s equity rose 14.6% to USD 7.50 per share today for a market cap of USD 2.5bn.

RentPath loans kept steady this week after soaring on 19 February on the heels of competitor Redfin entering into an agreement to buy the company for USD 608m in cash, according to a trader. 

RentPath previously agreed to sell its assets to competitor CoStar for USD 587.5m but moved to terminate the deal in December 2020 after the Federal Trade Commission blocked the transaction for antitrust issues. The parties also reached an agreement yesterday regarding the settlement for the transaction breakup fee.

RentPath’s USD 492.4m Libor+ 475bps term loan due 2021 is quoted 85.036/88.5 today, in line with quotes yesterday, the trader noted. Prior to the deal announcement, the loan was quoted 35.969/38.25 on 18 February, according to Markit. The company’s second lien term loan also moved up, with bid/asks in the 10/14.833 context, versus 0.833/2.667 on 18 February.  

Vine Oil & Gas bonds jumped today after the company refiled an initial public offering with the SEC to raise up to USD 100m. The Blackstone Group-backed natural gas E&P previously filed an IPO to raise USD 500m in April 2017 but withdrew the attempt in May 2019. 

Vine’s USD 380m 9.75% senior unsecured notes due 2023 bounced to trade at 101 to yield 8.788% today, from 97 to yield 11.348% on 18 February and trades at 96 in early February. The borrower’s USD 530m 8.75% senior unsecured notes due 2023 grinded higher to 100.25 to yield 8.571% today, from 96 to yield 10.881% yesterday and 94.5 in early February. 

2021 Debtwire

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