These are not bonds from companies at high risk of bankruptcy. However, sometimes their bond prices still drop sharply without any justifiable reason. For example, the bond price of New Fortress Energy (maturity date: Sep 30, 2026) dropped sharply, from about 95 down to 81.7 (its lowest) within just a few days. I searched for any news or events to see if I could find a good reason behind the sharp drop, but I couldn't find any. I understand that this company is not in good financial shape, but it is still far from insolvency. It remains safe for at least a few more years. It is a concern if you hold its stock, but not if you hold its bonds. You will receive all your money back with interest at maturity as long as the company doesn't go bankrupt. There are 15 analyst recommendations on its stock, and none recommend a "sell". Their recommendations range from "hold" to "strong buy". Are investors unduly panicked, or do they really see something that I am missing? Thank you for your time and answer.
there is an old saying, you look at their interest, they want your principal. what's rating, junk? then look at super senior tranche and compare. insiders know something that outsiders dont
ai The sharp decline in the bond price of New Fortress Energy's (NFE) 6.5% notes maturing on September 30, 2026, from approximately 95 to a low of 81.7, can be attributed to several interconnected factors: Financial Performance and Debt Management: In December 2024, NFE announced a comprehensive debt refinancing plan, aiming to refinance $2.4 billion of existing bonds, including those maturing in 2025 and a significant portion of those due in 2026 and 2029. This move was intended to strengthen the company's balance sheet and extend debt maturities. However, such large-scale refinancing can signal underlying liquidity challenges, potentially raising concerns among bondholders about the company's financial stability.ir.newfortressenergy.com Credit Rating Downgrade: On December 19, 2024, Fitch Ratings downgraded NFE's Long-Term Issuer Default Rating from 'B+' to 'B' and maintained a Rating Watch Negative. Credit rating downgrades typically reflect increased perceived risk, leading to a decline in bond prices as investors demand higher yields for the added risk.fitchratings.com Operational Challenges: In November 2024, NFE reported expectations of lower LNG volumes in the fourth quarter due to maintenance activities. Operational setbacks can impact revenue projections, influencing investor confidence in the company's ability to meet its debt obligations.reuters.com+1reuters.com+1 Market Sentiment and Insider Activity: Despite these challenges, there have been positive signals, such as the Chief Financial Officer, Christopher Guinta, purchasing $42,850 worth of NFE stock on March 13, 2025, indicating insider confidence in the company's prospects. However, the overall market sentiment remains cautious due to the factors mentioned above.investing.com In summary, the sharp drop in the bond's price appears to be a reaction to NFE's debt refinancing activities, credit rating downgrade, and operational challenges, all of which have heightened investor concerns about the company's financial health and its ability to service debt obligations. Recent Developments Affecting New Fortress Energy reuters.com New Fortress Energy seeks strategic partners to enhance liquidity 128 days ago reuters.com New Fortress Energy ships Mexico's first LNG cargo for export 164 days ago reuters.com New Fortress Energy expects lower LNG volumes in fourth quarter 126 days ago
Well it is actually good news for bond holders (year 2026) if I get it right. Although there is an concern in the long run, it shouldn't be an issue for the company to repay bonds (year 2026) after successful refinancing. The price was steady after the announcement of the downgrade. It seems to me the sudden drop this time is not directly related to the downgrade. Thank you for your reply.
Yep it is true in principal. However there are times when the market is overreacting and this creates good investing opportunities.
Yea..seems nothing will be real in 5 years ..maybe less. Whats odd is that in asia..I dont see any artifical life..its still real. Just a competition to develop the best AI for introduction into USA. This forum has been salted with automated bots more than most of the financial forums...other than wsb. But I think thats the point. In a fiat propped market struggling to hold itself up in the face of hollow value and losing its monetary basis..it is hoped that AI can manipulate people into holding and believing. Bitcoin and AI ..to create an artificial reality of financial meaning and trade