10-2-2015 (Societe Generale) HY Credit Research - HY TMT Credit Monthly - After mixed August, sell-off accelerates in September.71826638

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1、CREDIT2October2015EuropeHYTMTCreditMonthlyAftermixedAugust,sell-offacceleratesinSeptemberInthisissue,wediscussHYTMTbond/CDSperformanceoverthepastmonth.Wealsoreviewthemarketfromarelative-valueperspectiveandhighlighttheimpactofrecentnewsflowandinterestingtradingopportunities.Our

2、topthreetradeideasare:BuyMATTER2022secd/2022snrs:TheMATTERbondshavebeenimpactedbytherecentBenchmarkspreads&yields31-Aug30-SepmarketweaknessbutcontinuetoremainattractiveinourviewgivenourexpectationofaH2€HYYld4.75.6turnaroundinKPIs,improvedcashgenerationfromFY16withdeleveraging(

3、closerto4xleverage€HYSpdtoB’mk451551from4.5xcurrently).€HYBBYld3.94.8€HYBYld6.77.6BuyNUMFP€2022/2024s:WithNumericablepostinganotherstrongquarterofEBITDAgrowthinQ2,wethinksecuredleveragecanremaininthelow3xarea,pro-formaforthesecondpayment€HYBBSpdtoB’mk370467forAltice’sincreased

4、equitystakeduebyApril2016.Inamorevolatilehighyieldmarket,we€HYBSpdtoB’mk663758expectthesebondstoalsoremainrelativeresilient.ItraxxXover5yr324373BuyTNET2027s:Wethinkthe2027bondsoffergoodvalueversussimilarbondsfromotherLibertyGlobal-ownedcompaniessuchastheUnitymedia3.5%2027s,wit

5、htheyieldandspreadAnalystspick-upmorethancompensatingforTNET’slowerratingandslightlyriskierbusinessprofile.WeRobertJaeger,CFAthinkthependingacquisitionofBasewillfurtherenhancethecompany’sconvergencestrategy(44)2076767023robert.jaeger@sgcib.comandstrongpositioninginacompetitive

6、market.PriyaViswanathan,CFA5YCDS1-monthperformanceto30September2015(91)8028037458priya.viswanathan@sgcib.com10201801monthchangeAverage1307408046030180-20-100-70-380TIOTENOKPLAYXoverUPCUnityWindAlcatelVMEDNUMFPAlticeIntAlticeSASuncomBestWorstOIBRBZ(Rhs)HYTMT:Monthlytotalreturnt

7、o30September20155%TotalReturn-1monthAverage(Lhs)5%-15%-5%-35%-15%-2220(Lhs)5.5%25-6.25%29￡SUNCOM￡WIND7%21EURIboxxHYWIND4%20TITIM4%20OTE3.5%20TNET6.25%22UPC6.75%23AlticeInt9%23OIBRBZMATT4.875%23ATCNA7.25%22UNITY6.25%29VMEDMATT3.875%22UNITY5.125%23AlticeInt6.5%22CGMFP6.75%20VMED

8、NUMFP5.625%24NUMFP5.375%22AlticeInt5.25%23SocieteGenerale(“SG