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ANALYST DIRECT

Investment Grade

-	Autos: Carol Levenson
-	Basic Industries: Carol Levenson
-	Brokers: Kathy Shanley
-	Capital Goods: Carol Levenson
-	Consumer: Carol Levenson
-	Energy: Phil Adams
-	Finance (F.I.R.E.): Kathy Shanley
-	Food: Dave Novosel
-	Healthcare: Carol Levenson
-	Retailing, Leisure: Carol Levenson
-	T.M.T.: Dave Novosel
-	Transportation: Phil Adams
-	Utilities: Phil Adams

High Yield

-	Aerospace & Defense: Evan Mann
-	Airlines: Vicki Bryan
-	Autos, Auto Suppliers: Evan Mann
-	Broadcasting & Cable: Kim Noland
-	Building Products: Vicki Bryan
-	Consumer: Kim Noland
-	Food: Vicki Bryan
-	Retail, Gaming, Leisure: Kim Noland
-	Healthcare: Vicki Bryan
-	Homebuilding: Vicki Bryan
-	Industrials: Vicki Bryan
-	Media: Kim Noland
-	Metals & Industrial Services: Evan Mann
-	Paper & Forest: Kim Noland
-	Telecom: Kim Noland
-	T.M.T. Dave Novosel
-	Transportation: Vicki Bryan

Emerging Markets

-	Cedric Rimaud
-	Alexandre Dray
-	Nuj Chiaranussati

General

-	Research@GimmeCredit.com


Azul SA 12-12 03:58 GMT (Report with Analyst's Data Sheet) The November traffic numbers were strong for Azul S.A. (AZULBZ), which saw an increase in passengers of 14.4% on a capacity higher by 12.4%. This is much better than...
Growth Ahead by Cedric Rimaud, CFA


Frontier Communications 12-12 03:33 GMT (Report with Analyst's Data Sheet) Frontier Communications has roughly $630 million of bonds maturing over the next two years. We doubt that these could be refinanced in the...
Don't Use The "B" Word Just Yet by Dave Novosel, CFA


Target 12-12 03:11 GMT (Report with Analyst's Data Sheet) Target has not been shy about its plans to go after the toy and baby holiday sales now up for grabs after the demise of Toys 'R' Us. This is one of the reasons its...
Toy Story by Carol Levenson, CFA


Bank of New York Mellon 12-11 03:58 GMT (Report with Analyst's Data Sheet) Bank of New York Mellon (BK) has posted stable earnings so far this year. To be sure, total revenue increased only 1% year-over-year in the...
Buyback Bump by Kathleen Shanley, CFA


Teck Resources 12-11 03:48 GMT (Report with Analyst's Data Sheet) Last week, Teck Resources (TECK) announced the anticipated minority partnering transaction and final board approval for its Quebrada Blanca Phase 2 (QB2)...
QB2 Partner Announced by Evan Mann, CFA


ESKOM Holdings SOC Ltd. 12-11 03:35 GMT (Report with Analyst's Data Sheet) South Africa's Public Enterprises Minister Pravin Gordhan said last week that the government is discussing restructuring the debt of ESKOM...
Bound To Happen by Alexandre Dray


Teck Resources 12-10 16:26 GMT (Comment) Last week, Teck Resources (TECK) announced that Sumitomo will contribute U.S. $1.2 billion for...
New Financing by Evan Mann, CFA Last week, Teck Resources (TECK) announced that Sumitomo will contribute U.S. $1.2 billion for a 30% interest in its Quebrada Blanca Phase 2 (QB2) expansion project in northern Chile. This transaction is expected to close by the end of April with TECK retaining a 60% stake in QB2 while a 10% non-funding interest is held by a Chilean state agency. The total capital cost of the planned mine expansion is estimated at U.S. $4.7 billion with first production targeted to ramp up in late 2021. The company noted it was also in advanced talks for U.S. $2.5 billion in limited recourse project financing that it will share pro rata with Sumitomo. Successful closing of the partnership and project financing transactions would reduce TECK's equity contribution for the QB2 project to U.S. $693 million with the first payment not due until late 2020 which should be easily funded with free cash flow and if necessary, revolver availability. We will update our projections and review our rating shortly.


Altria Group, Inc. 12-07 17:01 GMT (Comment) From e-vapor to pot. Today the rumor became a fact, as Altria announced it would take a...
Acquisition by Carol Levenson, CFA From e-vapor to pot. Today the rumor became a fact, as Altria announced it would take a 45% stake in Canadian cannabis producer Cronos Group. The price of the first 45% is an astronomical 41.5% premium to the 10-day volume weighted average price for Cronos shares before the rumor, for a total cash outlay of $1.8 billion. In addition, Altria will have warrants exercisable over the next four years to purchase another ten percentage points at an even more astronomical 66% premium (another $1 billion), bringing its stake to 55%. It's easy to see the attraction of this deal for Cronos, which will be able to speed up its growth strategies and enhance its R&D spending, while benefiting from Altria's legendary marketing and brand management skills, as well as rely upon Altria for legal and regulatory support under commercial agreements to be signed at closing. In addition, Cronos will be Altria's exclusive cannabis partner throughout the world, shutting out any potential competitors. Altria has lined up bank financing from JP Morgan for the initial stake, but will consider permanent financing, presumably in the bond market. In a separate press release this morning, Altria said it would discontinue its MarkTen and Green Smoke e-vapor products and Verve oral nicotine containing products, for reasons both financial and regulatory, for a pretax writeoff of $200 million, largely noncash. Recall the company had already decided to discontinue its flavored e-vapor products apart from tobacco, mint, and menthol flavors in response to FDA concerns about youth usage. As we discussed in our earlier comment, Altria has sufficient financial flexibility to throw money at the cannabis market, obviously in the hope of legalization at the U.S. Federal level. We didn't anticipate a premium this lofty for a minority stake (but a board majority), however. Nevertheless, we estimate the company's pro forma leverage for the entire 55% would only increase from 1.4x to 1.7x, assuming no EBITDA contribution from the Cronos stake. Thus we view this as a credit neutral event for Altria, with speculative but potent future potential.

SCE 12-03
CSN 11-21
Macy's 11-16


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Nov 19, 2018 | Barron's

CL on CA Wildfires - Q- "The utility conceivably could have embraced Plan B-meaning bankruptcy-...Levenson warned that the potential liability warrants a junk rating, and she recommends selling the bonds."

Nov 14, 2018 | Bloomberg

CL on PG&E's Financial Crisis-Q-"It's not unusual for downgrades to come fast and furiously in situations like this, so a downgrade to below investment grade is certainly a real possibility,"

Nov 1, 2018 | CNN

CL on GE's Debt Headaches-Q-"Nobody leaves" commercial paper "voluntarily"..."This is a sign of reduced financial flexibility"

Aug 20, 2018 | Barron's

CL on risk in triple 'B' bonds-Q-"Anticipating where problems may arise isn't easy . Levenson notes that "the downgrades will come after the fact [of a slowdown or recession]. "

Jun 16, 2018 | Barron's

GC on AT&T - Q- "On that score, Gimme Credit, the very independent corporate credit research outfit, last week reiterated its negative stance on AT&T's notes maturing in 2027, given the increase in leverage following the Time Warner acquisition."