Novacare (NOV) breaking out... Message Board

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Biotech / Medical : Novacare (NOV) breaking out...

NOV 15.72

+1.2%

2:37 PM EST

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To: simarx who wrote (339)	10/14/1998 9:41:00 PM
From: mortwald	Read Replies (1) of 420

There's something very wrong here. NOV has a convertible bond, 5.5%, due Jan. 2000. It closed at 61 today. If they don't default, this would imply a yield of about 70% over the next 15 months. The inference seems to be they will be able to neither pay off or refinance. If the bondholders have any protection, (unlikely) the bonds should be a smarter buy than the stock. ...........................................mort

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