Nov. 17, 2009 (Business Wire) -- Rising liquidity and widening CDS spreads are indicating uncertainty for one of the United States' largest chipmakers, according to Fitch Solutions in its latest update on Global CDS Spreads/Liquidity Scores for companies scheduled to come out with earnings announcements in the coming week.
'Dell's second quarter fiscal year 2010 results showed falls in both revenue and operating income down 22% and 18% respectively on a year over year basis with 2008,' said Author and Managing Director Thomas Aubrey. 'Dell also highlighted that the third quarter is generally a period of slower demand from large commercial customers in the U.S. and Europe and that the refresh cycle in commercial accounts is now more likely to occur in 2010.'
Additionally, with the holiday shopping season now in full swing, CDS spreads and liquidity are painting a mixed picture for retailers. 'Widening spreads and increasing liquidity at Gap and Lowe's contrast with narrowing spreads and decreasing liquidity at Target,' said Aubrey.
North America:
Dell Inc. (TECHNOLOGY/Technology Hardware & Equipment)
Credit spreads have widened over the last three months with the five year point widening from 68 bps to 75 bps, an increase of 11%. Liquidity on Dell Inc. increased from trading in the 19th percentile to the 10th percentile. Its liquidity score increased from 7.90 to 7.88 over the three-month period.
Gap, Inc. (The) (CONSUMER SERVICES/General Retailers)
Credit spreads have widened over the last three months with the five-year point widening from 29 bps to 35 bps, an increase of 21%. Liquidity on Gap, Inc. increased from trading in the 29th percentile to the 20th percentile. Its liquidity score decreased from 8.33 to 8.34 over the three-month period.
Home Depot Inc. (CONSUMER SERVICES/General Retailers)
Credit spreads have remained steady over the last three months with the five-year point moving around the 62 bps level. Liquidity on Home Depot Inc. increased from trading in the 20th percentile to the 18th percentile. Its liquidity score decreased from 7.92 to 8.25 over the three-month period.
Limited Brands (CONSUMER SERVICES/General Retailers)
Credit spreads have tightened over the last three months with the five-year point tightening from 303 bps to 273 bps, a decrease of 10%. Liquidity on Limited Brands decreased from trading in the 2nd percentile to the 3rd percentile. Its liquidity score decreased from 6.62 to 7.49 over the three-month period.
Lowe's Companies Inc. (CONSUMER SERVICES/General Retailers)
Credit spreads have widened over the last three months with the five-year point widening from 50 bps to 62 bps, an increase of 24%. Liquidity on Lowe's Companies Inc. increased from trading in the 37th percentile to the 27th percentile. Its liquidity score increased from 8.63 to 8.53 over the three-month period.
Saks Incorporated (CONSUMER SERVICES/General Retailers)
Credit spreads have tightened over the last three months with the five-year point tightening from 1090 bps to 753 bps, a decrease of 31%. Liquidity on Saks Incorporated increased from trading in the 11th percentile to the 4th percentile. Its liquidity score decreased from 7.47 to 7.52 over the three-month period.
Target Corporation (CONSUMER SERVICES/General Retailers)
Credit spreads have tightened over the last three months with the five-year point tightening from 77 bps to 72 bps, a decrease of 7%. Liquidity on Target Corporation decreased from trading in the 27th percentile to the 44th percentile. Its liquidity score decreased from 8.22 to 9.15 over the three-month period.
TJX Companies Inc. (CONSUMER SERVICES/General Retailers)
Credit spreads have widened over the last three months with the five-year point widening from 32 bps to 54 bps, an increase of 66%. Liquidity on TJX Companies Inc. decreased from trading in the 51st percentile to the 60th percentile. Its liquidity score decreased from 9.27 to 9.75 over the three-month period.
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