Restoration Hardware drops after earnings miss, lowered guidance; Weatherford improves

By Rebecca Melvin

New York, June 9 – Restoration Hardware Holdings Inc.’s two series of 0% convertibles were lower in active trade on Thursday after the Corte Madera, Calif.-based specialty retailer missed earnings estimates and lowered guidance for the current fiscal year.

Trading in the two issues accounted for a good portion of the day’s secondary market volume, New York-based traders said.

“Restoration Hardware is in focus with the stock getting slammed,” a trader said.

Restoration Hardware’s 0% convertibles due 2020 were down 2 points to 70 and the Restoration Hardware 0% convertibles due 2019 gapped down 3 points to 77.5, according to Trace data.

Restoration Hardware shares were down $7.62, or 21%, to $28.45.

Elsewhere, Weatherford International Ltd.’s 5.875% exchangeables continued to surge. The paper traded up another 1.5 points to 121.5 bid, 122 offered as news of a straight bond deal boosted the convertibles, which priced last week.

In the primary market, Tutor Perini Corp. modeled cheaply and was expected to do well in the space, a trader said, ahead of final terms expected to be fixed after the market close. The $125 million offering of five-year convertible senior notes was being talked at a 3.25% to 3.75% coupon and a 32.5% to 37.5% initial conversion premium.

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