Zynex pops on aftermarket debut; Live Nation, Opendoor strong post-earnings; CMS gains

By Abigail W. Adams

Portland, Me., May 5 – The convertibles primary market capped the second-highest volume week of the year for new issuance with one final deal pricing.

Zynex Inc. sold an upsized $52.5 million offering of three-year convertible notes after the market close on Thursday.

The deal brought the weekly tally to $3.15 billion, which priced over four deals, the second largest week of the year for the primary market since the $5.49 billion that priced during the Feb. 19 week.

The new paper came on a volatile week for markets with continued turmoil in the banking sector, the specter of a government default, and the Federal Open Market Committee meeting rocking markets.

However, markets closed the week with a strong tone with equities surging as regional banks rebounded.

The Dow Jones industrial average closed Friday up 547 points, or 1.65%, the S&P 500 index closed up 1.85%, the Nasdaq Composite index closed up 2.25% and the Russell 2000 index closed up 2.39%.

There was $77 million in reported convertibles trading volume one hour into the session and $447 million on the tape about one hour before the market close.

While activity surrounding recent issues tempered, they continued to put in strong aftermarket performances.

CMS Energy Corp.’s 3.375% convertible notes due 2028 (Baa2) remained the top traded issue in the secondary space with the notes’ upward momentum continuing.

While Zynex’s offering played to a limited pool of investors during bookbuilding, the new notes were relatively active given the small issue size and soared on their aftermarket debut.

Earnings-related news remained a driver of trading activity with several issues making large gains on better-than-expected results.

Live Nation Entertainment, Inc.’s 3.125% convertible notes due 2029 popped above par for the first time since early March and made strong gains dollar-neutral following earnings.

Opendoor Technologies Inc.’s 0.25% convertible notes due 2026 were the largest gainers of Friday’s session with the struggling notes surging dollar-neutral after a surprise earnings beat.

Zynex soars

Zynex sold an upsized $52.5 million, from $50 million, offering of three-year convertible notes after the market close on Thursday with a coupon 5% and an initial conversion premium of 15%.

The small offering played to a limited pool of investors, sources said.

However, the notes were relatively active in the aftermarket given the small size of the issues.

They skyrocketed on debut and were trading at 105 in the late afternoon.

The notes expanded about 5 points dollar-neutral, a source said.

Zynex’s stock traded to a low of $9.04 and a high of $9.55 before closing flat at $9.37.

The convertible notes offering was initially launched with a concurrent secondary offering of 2 million shares with CEO Thomas Sandgaard the selling shareholder.

However, the secondary offering was withdrawn due to market conditions.

Zynex’s stock sank 35% on Thursday.

CMS strong

The upward momentum of CMS’ 3.375% convertible notes due 2028 continued on Friday with the notes adding outright on a strong day for stock.

The 3.375% rose 0.5 point outright with stock up 1%.

The notes were changing hands at 102.5 in the late afternoon.

There was $54 million in reported volume.

CMS’ stock traded to a low of $60.64 and a high of $62.03 before closing at $61.98, up 1.13%.

Live Nation tops par

Live Nation’s 3.125% convertible notes due 2029 made strong outright and dollar-neutral gains on Friday as stock surged post-earnings.

The 3.125% notes gained 5.5 points outright with stock up 15%.

The notes were seen at 101.375 early in the session and climbed to 102.5 in the late afternoon, according to a market source.

It was the first time the 3.125% notes traded above par since early March.

The notes expanded 0.5 to 0.75 point dollar-neutral on the move up, a source said.

There was $19 million in reported volume.

Live Nation’s stock traded to a low of $73.70 and a high of $79.07 before closing at $77.16, an increase of 15.04%.

The entertainment company’s stock surged after a large earnings beat with the company reporting losses per share of 20 cents versus analyst expectations for losses of 47 cents.

Revenue was $3.13 billion versus analyst expectations for revenue of $2.27 billion.

Opendoor surges

Opendoor’s struggling 0.25% convertible notes due 2026 surged on Friday as stock soared after a surprise earnings beat.

The 0.25% notes traded up to 52 with the yield narrowing to 21.5%, according to a market source.

The convertibles were on a 47-handle heading into Friday’s session.

The notes gained 4 points dollar-neutral, a source said.

There was $12 million in reported volume.

Opendoor’s stock traded to a low of $1.47 and a high of $1.80 before closing at $1.79, an increase of 32.59%.

The residential real estate company reported losses per share of 64 cents versus analyst expectations for losses of 72 cents.

Revenue was $3.12 billion versus analyst expectations for revenue of $2.81 billion.

Mentioned in this article:

CMS Energy Corp. NYSE: CMS

Live Nation Entertainment, Inc. NYSE: LYV

Opendoor Technologies Inc. Nasdaq: OPEN

Zynex Inc. Nasdaq: ZYXI

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