GREY:WFREF - Post by User
Comment by
wilwalon Aug 04, 2015 5:55pm
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Post# 23988701
RE:Debentures outperformed as usual
RE:Debentures outperformed as usualLRE is highly default sensitive and that usually affects creditors more than common shareholders. (Just note the bankers demanding $245 million). So when the bank is satisfied by asset sale or in this case, fresh capital, it should affect the debs more than the commons, and it did. I'm surprised they didn't go higher as the volume was the biggest day of the last 52 weeks.
Debs still have room to run higher. Once the bank is paid off, they should trade closer to $80. Still discounted because the company continues to have a lot of bank debt that has priority over the debs. An asset sale of some non-core properties could move the debs even higher than $80.
Again, dependent on oil prices. Debs will be more sensitive than commons to the downside if oil continues its downward streak into the $30's for awhile.