Consumer Discretionary
Clear gap between the valuation of ATD’s stock and the valuation of its new term loan - this gap is being driven by credit investors who not only are spooked by the still elevated LTM net leverage level of 5.6x (even though the company has reduced it from 9.1x (2Q20)), but also do not understand the structural importance of the distribution business in the tire industry. The safety margin for error for the term loan is material and the ~7% yield is attractive.
Edition: 123
- 12 November, 2021