Andres Victorero The above is Briefing.com’s weekly economic data table. April ’24 PPI and April ’24 CPI are due out Tuesday, May 14th, and Wednesday, May 15th, respectively. Shelter or OER (owners’ equivalent rent) has a significant influence on the CPI given its weight (roughly 30% of the inflation gauge) and then add in auto…
numismarty/iStock via Getty Images PM is undervalued The thesis of this article is to explain the risks hidden behind Philip Morris International Inc.’s (NYSE:PM) dividend yield. The chart below summarizes consensus ratings of the stock’s dividend grades and compares them to the sector median. As seen, PM’s dividend yield across all metrics receives an A…
ryasick Investing in corporate credit at this point in the cycle is risky to me, given just how narrow credit spreads are. Having said that, there is still opportunity, so long as you access the space by limiting exposure to overpriced and vulnerable bonds. That’s why the BNY Mellon High Yield Beta ETF (NYSEARCA:BKHY) is…
Sweeping across the shores of Latin America comes a scheme from some of the most predatory figures in the venture capital ecosystem of the United States. It is a brazen attempt to assert foreign influence across Latin America and threatens to reshape the very fabric of the region and the day to day lives of…
Lakes4life/E+ via Getty Images Overview I recently covered Oxford Lane Capital (OXLC) and within that article I briefly gave an overview to compare Eagle Point Credit (NYSE:ECC) since both of the funds operate as Closed End Funds with a focus on CLOs. From the comments on my OXLC article, it seemed like the general consensus…
Andrii Dodonov By Tracy Chen, CFA, CAIA Convexity, which measures interest rate sensitivity and drives the risk and return profiles of fixed income products, is an important concept that investors can utilize to boost total return and manage risk. It can be particularly important and may increase sharply during periods in which interest rates move…
CHUNYIP WONG Back in the fall of 2022, I wrote a cautious article on the iShares iBoxx $ High Yield Corporate Bond ETF (NYSEARCA:HYG), warning that slowing economic growth will likely lead to rising corporate defaults and more pain for credit investors. However, my prediction for an impending recession in 2023 failed to materialize, as…
simonkr The iShares National Muni Bond ETF (NYSEARCA:MUB) tracks the listed muni bond market, with substantial exposure to California and New York states in the US. The duration is quite long on this ETF at 6 years, so speculation on relatively short-term factors will matter. The ETF is super efficient with an expense ratio of…
Torsten Asmus The iShares BB Rated Corporate Bond ETF (NYSEARCA:HYBB) covers mostly BB rated fixed income securities in the corporate US debt market. The two key things to focus on are credit rating and duration. We think that credit spreads are a little too low in the current environment considering the risks to corporate debt…
Michael M. Santiago A new theme has emerged in the fourth quarter for investors in business development companies: Credit quality. A number of BDCs have disappointed here lately, including Oaktree Specialty Lending Corp. (OCSL) and FS KKR Capital (FSK) whose reports caused a good amount of value destruction for shareholders. Goldman Sachs BDC (NYSE:GSBD) just…
champpixs Transcript As the macro backdrop improves in the near term, we get granular to seize opportunities in the new regime. We see more market risk-taking as inflation falls and the Federal Reserve readies interest rate cuts. 1) Credit yields The spread between yields for sovereign bonds and credit has steadily tightened, even as the…
Pixelimage Blackstone Secured Lending (NYSE:BXSL) out-earned its dividend with net investment income in the fourth quarter which in turn led to the BDC reporting a 1% QoQ increase in its net asset value per share. The BDC’s large floating-rate debt portfolio is still producing top results for Blackstone Secured Lending and BXSL is a rare…
monsitj Market Commentary High yield bonds and leveraged loans produced gains in the fourth quarter, with high yield bonds outperforming their floating rate peers. During the quarter, benign inflation and dovish Fed rhetoric helped drive interest rates meaningfully lower, which benefited high yield bonds in particular. In addition, credit spreads tightened in both asset classes…
Dilok Klaisataporn Business development companies deliver solid dividend yields to passive income investors. One BDC that I have owned for a while and that provides a high-yield as well as dividend growth is Golub Capital BDC (NASDAQ:GBDC). With the stock now selling for a 2% premium to net asset value, even the company’s robust net…
Abdullah Durmaz/E+ via Getty Images Investment thesis: With around two-thirds of the US economy dependent on the consumer, the rate of consumer spending growth tends to be the main determining factor that drives the US economy. There are fiscal as well as monetary policies that can affect consumer spending. For instance, high-interest rates for a…
Shutter2U Back in the Summer of 2016, I wrote an article analyzing Discover Financial Services (NYSE:DFS) and Synchrony Financial (SYF). The context was looking for safe financials during uncertainty surrounding the Brexit. My conclusion was both stocks were appealing, but Discover Financial had an advantage because of the dividends they offered. Seven and a half…
NNehring/iStock via Getty Images I’ve been buying Eagle Point Credit’s Series D Preferreds (NYSE:ECC.PR.D) since the tail end of 2023. This has come in response to the continued weakness of preferreds whose sensitivity to higher base rates from positive duration risk has opened up historic discounts to their intrinsic value. The series D preferreds, which…
Credit Vaults empower borrowers by allowing them to customize loan terms according to their specific requirements. The increased interest rates provided by the solution encourage more lenders to join. Clearpool, a decentralized finance (DeFi) lending protocol, has introduced a groundbreaking product called Credit Vaults. With this solution, the network aims to optimize lending efficiency and…
tadamichi Investing in fixed-income securities, particularly corporate bonds, is an essential part of diversifying one’s investment portfolio. And it becomes a lot easier when the Fed isn’t raising rates. That’s one reason the iShares 5-10 Year Investment Grade Corporate Bond ETF (IGIB) is worth a look. IGIB is an exchange-traded fund that primarily invests in…
shapecharge/E+ via Getty Images Logo (company website) Executive Summary Blue Owl Capital Corporation (NYSE:OBDC) emerges as a formidable force in the private credit and direct lending space, demonstrating remarkable growth and potential. The company is the largest publicly traded business development company, or BDC, by total assets ($12.9 billion) and is focused on senior secured…
phototechno In keeping with my coverage on short-term and variable rate funds, thought to have a look at the FolioBeyond Alternative Income and Interest Rate Hedge ETF (NYSEARCA:NYSEARCA:RISR). RISR invests in traditional mortgage-backed securities, or MBS, as well as interest only MBS. Both securities offer good yields, in the 6.0% – 8.0% range, with the…
Pipat Yapathanasap/iStock via Getty Images Chicago Atlantic Real Estate Finance (NASDAQ:REFI) is the slightly larger cannabis mortgage REIT versus peer AFC Gamma (AFCG). Its focus on cannabis credit has meant a multi-layered risk profile from both rising interest rates over the last 2 years and concentration in a single industry that has seen intense headwinds…
uschools The Bureau of Labor Statistics on November 14, remarkably, announced that the US CPI had been unchanged in October (whether seasonally adjusted or not). That is, the level of the CPI was unchanged, not the inflation rate, which was zero. Of course, single-month numbers are too volatile to draw much of a conclusion. Not…
Phiromya Intawongpan Eagle Point Credit Co LLC (NYSE:ECC) demonstrated notable financial achievements in Q3 2023, attributed to its strategic actions and intelligent investment decisions. The company’s financial highlights included increased Net Asset Value (NAV) per common share and a robust financial performance with a notable Net Investment Income (NII). During this period, ECC focused on…
RobsonPL After analyzing Intesa Sanpaolo and BNP Paribas’ quarterly performance, today we decided to move forward with Crédit Agricole (OTCPK:CRARF). Post the bank ‘Ambitions 2025‘ plan and Q2 results; we increased our target price to €13.1 per share. Italian and French banks are correlated, given the fact that both Crédit Agricole and BNP Paribas have…
blackCAT/E+ via Getty Images Introduction The end of interest rate increases is in sight, after inflation figures came out better than expected. The Federal Reserve recently paused interest rate increases at 5.3%, and a slight rate cut is expected next year. This makes the economic prospects interesting again, especially for subprime auto lenders. Many hope…
golfcphoto Those who can, pay cash to avoid the interest rates. Subprime credit tightens substantially. The balance of auto loans and leases rose by 0.8% in Q3 from Q2, and by 4.7% year-over-year, to 1.60 trillion, driven by financing of new vehicles, according to data from the New York Fed’s Household Debt and Credit Report….
MTStock Studio/E+ via Getty Images Listen below or on the go on Apple Podcasts and Spotify Credit card debt hits new record, delinquencies rise most among millennials. (00:23) CarGurus (CARG) to fully acquire online car dealership CarOffer for $75M. (01:27) Virgin Galactic (SPCE) cuts jobs to support Delta spaceship production. (02:04) This is an abridged…
The UBS report for Q3 2023 showed that the company’s net loss increased because of expenses necessary due to the Credit Suisse integration. Multinational investment bank and financial services company UBS Group AG (SWX: UBSG.SW) has published its report for Q3 2023, showing a disappointing net loss. The banking giant announced $785 million in net…
Credit Acceptance Corporation (NASDAQ:CACC) Q3 2023 Earnings Conference Call October 30, 2023 5:00 PM ET Company Participants Douglas Busk – Chief Treasury Officer Conference Call Participants John Rowan – Janney Montgomery Scott John Hecht – Jefferies Robert Wildhack – Autonomous Research Operator Good day, everyone and welcome to the Credit Acceptance Corporation Third Quarter 2023…
Dilok Klaisataporn By Patricia Healy, CFA The third quarter of the year was certainly eventful. The US government almost shut down twice and the US government bond rating was downgraded by Fitch to below AAA, emphasizing governance issues. Fed members continued to signal higher-for-longer rates, raising fears of a recession. Strikes abounded, from screenwriters to…
Shunyu Fan I can understand why investors are still not bullish on bank stocks, given what’s going on with the yield curve, the economy, and regulation. I can likewise understand skepticism around names like Citigroup (C) where there’s built-up resentment and doubt that the bank will ever turn around. What I don’t get, though, is…
Filmstax/iStock via Getty Images Co-authored by Treading Softly This past Mother’s Day, I splurged on a gift for my wife. My wife and I are both heavy coffee drinkers. We love the smell. We love the taste. We love the experience of having a good cup of coffee or espresso drink. So this past Mother’s…
NicoElNino Investors, regulators, governments, suppliers, and others are playing a critical role in shaping environmental, social, and governance (ESG) practices as stakeholders look towards sustainability. To discover how these considerations are changing the landscape of credit risk management, S&P Global Market Intelligence (“Market Intelligence”) hosted a webinar, which examined the growing focus on ESG issues,…
Dilok Klaisataporn Bank lending is contracting across world economies. The percentage of US banks tightening their credit to large and medium firms (below since 1990 via Tier 1 Alpha) now above 40% – was only seen during the 2020 pandemic, the 2008 financial crisis, the 2001 Dotcom bust, and the 1990-91 recession. As higher interest…
vadimguzhva/iStock via Getty Images Shares of Advance Auto Parts (NYSE:AAP) have been a poor performer over the past year as the company’s shift to prioritizing its own brands has gone poorly, costing it market share and causing margins to contract. Shares fell another 7% on Tuesday as S&P downgraded AAP into “junk territory,” which may…
Hero Images Inc/DigitalVision via Getty Images A bank is a place that will lend you money, if you can prove that you don’t need it. – Bob Hope I’ve talked a lot in recent weeks about heightened risks for a potential credit event in markets and how Technology, because of the disposition effect whereby people…
Zhanna Hapanovich By Sandrine Soubeyran and Robin Marshall, Global Investment Research, FTSE Russell Euro high yield (HY) credits have outperformed Euro investment grade (IG) corporate bonds, and those of other regions, both in July and since the beginning of the year. The FTSE Euro High Yield Bond index was up 1.3% and 6.5% respectively in…
According to some experts, the idea of providing each person with a digital ID that also contains their social traits and other personal information is more akin to the Chinese social credit system. China is proposing a strategy to exert control over people’s activities in the metaverse by developing a scheme that looks like its…
Paola Iamunno You’ll often see the common advice that younger investors should ignore high yielding assets and instead, put their cash into growth oriented stocks. While I generally agree from a total return perspective, I think it’s important to determine what the overall goal of your portfolio is. Me personally, I aim for a hybrid…
anyaberkut/iStock via Getty Images First, I know I write incessantly about private mortgage insurers. I can’t help it. I just think they are generally ignored and frequently misunderstood when not ignored. Most importantly, I am confident they remain quite cheap to their likely outcomes for the next 5+ years. Second, a shout-out to me. Yes,…
Visa’s solution revolves around Ethereum’s ERC-4337 account abstraction standard and the utilization of a “paymaster” smart contract feature which allows off-chain settlements of gas fees. On Thursday, August 10, payments giant Visa Inc made an important announcement allowing users to pay the on-chain Ethereum gas fees directly in fiat currencies, either using a credit or…
The decision to consolidate these operations coincides with Rakuten’s unveiling its financial performance for the second quarter. Rakuten Group, a prominent player in the Japanese e-commerce sector, has unveiled its plan to bring together its payment and point businesses under Rakuten Card, its established credit card arm. The strategic move aims to improve the company’s…
Before releasing the latest ratings, Fitch had initially warned about a possible downgrade during US debt ceiling negotiations a few months ago. Fitch Ratings, one of the major credit rating agencies, downgraded the United States’ long-term foreign currency issuer default rating to AA+ from AAA on August 1. The move comes amid concerns over expected…