Friday, September 23, 2016

Bonanza Creek Energy Bonds Yielding 30%

There's $500 million outstanding of the 6.75% notes due 2021. The next coupon is on October 15, about three weeks away, and it will be for almost $17 million.

Given that they used the 30 day grace period on the ~$8.6 million unsecured interest payment on August 1st, it seems like there's a decent chance that they will default on this next payment.

1 comment:

Anonymous said...

I think your thinking is spot on. The equity value here is based entirely on some combination of can-kicking, OPEC discipline, and greater-foolery. Not that those aren't powerful forces, at least mentally!