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Pragmatist's Guide to Leveraged Finance Credit Analysis for Bonds and Bank Debt

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ISBN-10: 0132855232

ISBN-13: 9780132855235

Edition: 2012

Authors: Robert S. Kricheff

List price: $64.99
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The high-yield leveraged bond and loan market (“junk bonds”) is now valued at $3+ trillion in North America, €1 trillion in Europe, and another $1 trillion in emerging markets. What’s more, based on the maturity schedules of current debt, it’s poised for massive growth. To successfully issue, evaluate, and invest in high-yield debt, however, financial professionals need credit and bond analysis skills specific to these instruments. Now, for the first time, there’s a complete, practical, and expert tutorial and workbook covering all facets of modern leveraged finance analysis. InA Pragmatist’s Guide to Leveraged Finance,Credit Suisse managing director Bob Kricheff explains why conventional…    
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Book details

List price: $64.99
Copyright year: 2012
Publisher: FT Press
Publication date: 2/24/2012
Binding: Hardcover
Pages: 288
Size: 6.50" wide x 9.50" long x 1.25" tall
Weight: 1.100
Language: English

Bob Kricheff, (New York City) managing director at Credit Suisse, has 20+ years of experience in leveraged finance analysis for bonds, bank debt and CDS. He was ranked as a top analyst byInstitutional InvestorMagazine, has overseen emerging market and European bond research; and ran Leveraged Finance Strategy and Portfolio Analysis. He regularly trains analysts out of college and presents to training classes, while publishing over 100 reports per year and speaking at investment conferences throughout the US and Europe. He holds a BA from New York University in Economics and Journalism, and a MSc from the University of London in Financial Economics.

Common Leveraged Finance Terms
General Terms
Yield and Spread Definitions
Defining the Market and the Ratings Agencies
The Participants
The Issuers
The Sell Side
The Buy Side
Private Equity
Why Is Leveraged Finance Analysis Unique?
The Major Components of Analysis
The Components
A Pragmatic Point on the Various Aspects of Analysis
Some Features of Bank Loans
A Primer on Prices, Yields, and Spreads
The Basics
A Few Points on Yields
A Few Points on Spreads
Bank Loan Coupons
Total Returns
Deferred Payment Bonds: Prices and Yields
A Pragmatic Point on Terminology
A Primer on Key Points of Financial Statement Analysis
Capital Expenditures
Interest Expenses
Changes in Working Capital
Free Cash Flow
The Balance Sheet
A Pragmatic Point on Financial Statements
Credit Ratios
EBITDA/Interest Ratio
A Pragmatic Point on the Leverage Ratio
A Pragmatic Point on Valuations
Free Cash Flow Ratios
Changes in Working Capital
One-Time Charges
The FCF/Debt Ratio
A Pragmatic Point on Free Cash Flow
Business Trend Analysis and Operational Ratios
Business Trends
Margins and Expenses
Capital Expenditures
Expectations, Modeling, and Scenarios
Sales and Revenue
A Full Model
A Pragmatic Point on Bank Maintenance Covenants and Expectations
Structural Issues: Coupons
Loan Coupons
Bond Coupons
Zero and Zero-Step Coupons
How the Coupon Is Determined
Modeling Changes in Coupons
Structural Issues: Maturities, Calls, and Puts
10% Call
Cash Flow Sweeps
Other Bank Prepayments
Open-Market Repurchases
A Pragmatic Point on Early Refinancing of Debt
Structural Issues: Ranking of Debt
Structural Subordination
Subsidiary Guarantees
Key Leveraged Finance Covenants
Debt Incurrence
Defined Terms and Carve-outs
Defined Term Examples
Restricted Payments
Change of Control
Asset Sale
Reporting Requirements
Other Covenants
Affirmative/Maintenance Covenants
Restricted and Unrestricted Groups
Amendments, Waivers, and Consents
Making Money or Losing It Off of News Events
Scenario: An Issuer Makes an Acquisition
FastFoodCo (FFC) Facts
GoodFoodCo (GFC) Facts
Deal Facts
Scenario: The Issuer Gets Bought
Scenario: An Issuer Announces an IPO
Scenario: An Issuer Is Facing a Maturity
A Pragmatic Point on the Blended Price to Retire Debt
Management and Ownership
I'm Looking at Debt, So Why Does Equity Matter?
Monitoring Equities
Value, Relative Value, and Comparable Analysis
New Issuance
Distressed Credits, Bankruptcy, and Distressed Exchanges
Classes of Claims
Claims Arising from Bankruptcy
Valuing the Enterprise
Sale or Restructuring
Restructuring Without Bankruptcy
A Few Pragmatic Points on Bankruptcy Reorganizations
Preparing a Credit Snapshot
The Investment Decision Process
A Sample Investment Process
Big-Picture Items
The Company
Credit Fundamentals
Event Analysis
Security Analysis
Relative Value and Return
The Decision
Some Investment Traps
Closing Comments