Company Reports

PNC Buys BBVA USA: Motivated Seller, Cash Rich Buyer


PNC pulls the trigger and bags BBVA USA as the stars aligned for both. Still it shows that other big and weaker US regional banks not as motivated to sell hoping for vaccine relief and resumption of normal economics. Sell on PNC capital structure (stock and bonds) and counterparty and regulatory risk is Low. 

CFG @ BofA Securities & 3Q20: Pretend & Get Clobbered


Citizens Financial is not out of the pandemic and credit cycle woods as it continues to pretend it is in the growth mode; when it very much needs added capital to bolster the balance sheet. Still too much credit quality pressures even without a pandemic. Sell on stock, benchmark bonds, and preferred stock. Regulatory and counterparty risk stays at Medium levels which is high for a regional bank given weak economic earnings. 

Recap COF 3Q20: Chock Full of Subprime Sludge: How To Shovel Out?


Capital One is hanging on by a hair as government stimulous support has kept its credit quality together. But it could easily humpty dumpty fall and crash into millions of credit loss pieces. Sell capital stack (Stock & Bonds), Counterparty risk to Medium-to-High. Regulatory risk Medium. 

BAC 3Q20: Merrill Good, Ole BAC Bad


Bank of America did not show the same nominal lift in capital markets trading and investment banking that the other peer trading banks did. Still, Merrrill retail held its own by growing units via customers and products. Rate pressure really harming the biggest retail deposit bank with swaps hedges rather ineffective. So back to cash securities strategies. Sell on Capital Structure (debt & equity). Regulatory/Counterparty Indicatiors stays at Medium risk. 

JPM 3Q20: Credit Cruising or Future Bruising?


JPMorgan tried to wow the investor/risk mgt crowd with seemingly blockbuster results. Excluding one-offs it was a yawn of a quarter. JPM overconfident that worst of pandemic impacts is over. We are a Sell on the Equity and benchmark debt. And systemic risk and counterparty rise to Medium levels. 

FITB @ Barclays: False Positive, Steep Capital Negatives


Fifth Third is on happy pills as it believes that its loan credit quality won't spill into the red. We beg to differ and believe it is very short of common equity capital under a more severe economic/health climate. We are a Sell across its Stock & benchmark Bonds. And recognize Medium Systemic and Counterparty Risk. 

KEY @ Barclays: Delusional on Returns, Deluge of Credit Losses?


KEY was another cool regional bank presenter that was not too panicky on its future credit development and reserves. We beg to differ and see a big capital need if losses go to new highs given the health pandemic. Sell Stock, Buy benchmark Bonds on relative value basis. Higher regulatory and counterparty risk. 

Ferroglobe PLC: 2Q20: Alloy! Tech Wreck Resistant! Buy! Buy! Buy!


Ferroglobe has an improved EBITDA 2Q20 quarter. And it has fulcrum security leverage on its 9 3/8s notes and as it renegotiates bank lines. Good for the bonds, but bad for the stock in the short term. Buy Bonds, Sell Stock. 

Taseko Mines Ltd: 2Q20: Mr. Copper Dumpster? or David Copperfield Levitator?


Copper's on a roll, and Viola Risk is riding the bull case with Taseko Mines, among the most cost efficient in the world. As the world normailizes, post-Covid-19, Taseko will rocket higher on its  bonds (BUY) and stock (BUY). 

Curo Group Holdings: 2Q20: Pay Up or Else!


Curo may have the magic elixer to ricochet out of the deep subprime lending doldrums. Though VERT risk is high, Curo does have strong equity drivers to reset the EBITDA trend rate higher. Buy on HY Bonds, Buy on Stock. 

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