September 12, 2024 14:31 GMT
CAPITAL GOODS: MTU Aero Engines (MTXGR Baa3[P]/NR/BBB): New Issue Performance
CAPITAL GOODS
- MTXGR 3.875 09/31 was issued at B+204.4 and is quoted an impressive 21bp inside reoffer.
- At Z+148, that puts it inside where we would extrapolate the ROLLS (Baa3/[P]/BBB[P]/BBB-[P]) curve (150 area).
- ROLLS risk looks relatively more attractive to us; we expect positive ratings momentum sooner with ROLLS further down its recovery path than MTU in our opinion. Spreads were at mid triple B levels before the A350 story, currently closer to low triple B levels again.
Nonetheless MTXGR remains quite wide for the rating also.
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