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US High Yield Bond Funds See $1.1B Investor Cash Withdrawal

high yield bond flows

U.S. high-yield funds recorded an outflow of roughly $1.1 billion for the week ended Jan. 24, according to weekly reporters to Lipper only. This week’s outflow follows last week’s exit of roughly $3.1 billion, and brings the total outflow from high-yield funds so far this year to about $1.4 billion.

ETFs made up the bulk of this week’s outflow, with an exit of roughly $621 million, while $510 million was pulled out of mutual funds.

The four-week trailing average widened to negative $342 million, from negative $119.5 million last week.

The change due to market conditions this past week was an increase of $123.5 million. Total assets at the end of the observation period were $207.8 billion. ETFs account for about 24% of the total, at $50.3 billion. — James Passeri

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LCD comps is an offering of S&P Global Market Intelligence. LCD’s subscription site offers complete news, analysis and data covering the global leveraged loan and high yield bond markets. You can learn more about LCD here.

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Netflix Expects to Again Tap High Yield Markets, Highlighting Equity Cushion

Alongside Neflix’s fourth-quarter earnings rollout today, indicating adjusted EBITDA for the period above consensus forecasts, the issuer noted in a filing that it again intends to seek capital through high-yield markets, three months after the issuer placed $1.6 billion of unsecured bullet notes due 2028.

“We anticipate continuing to raise capital in the high yield market,” the company said in the Monday filing. “The new limitation on deductibility of interest costs is not expected to affect us. We are striving to make the right choices and investments to grow the value of the firm, and that is what also ultimately secures our debt. High yield has rarely seen an equity cushion so thick.”

Netflix 4.875% notes due 2028 rose 1.375 points on the day, to 99.875 in midafternoon trading, according to MarketAxess. Meanwhile, shares of Netflix (NYSE: NFLX) rose 9.3% in postmarket trading, climbing to about $248.50.

The streaming media provider booked adjusted EBITDA for the quarter of $312.9 million, topping analyst estimates by roughly 2.4%, based on consensus data provided by S&P Global Market Intelligence. Meanwhile, negative free cash flow of $524 million for the quarter topped forecasts of about negative $732.8 million. Netflix noted the FCF beat was largely due to the timing of content payments, which will now occur in 2018. Meanwhile, revenue of about $3.286 billion for the period fell roughly in line with estimates.

Netflix reported FCF for 2017 of about negative $2 billion, on the narrower of the issuer’s guidance of negative $2–2.5 billion, and above consensus estimates of roughly negative $2.175 billion for the period.

“In the near term, however, membership, revenue and original content spend are booming,” the company added. “We’re growing faster than we expected, which allows us to invest more in original content than we had planned, so our FCF will be around negative $3 billion to $4 billion in 2018.”

Netflix (Nasdaq: NFLX) is a Los Gatos, Calif.–based global streaming media provider. — James Passeri/ Jakema Lewis

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After Big Inflow, US High Yield Funds See $3.1B Investor Cash Withdrawal

high yield bond flows

U.S. high-yield funds recorded an outflow of roughly $3.1 billion for the week ended Jan. 17, according to weekly reporters to Lipper only.

This week’s outflow follows an inflow of $2.65 billion last week, and puts the total outflow so far this year at about $238 million.

ETFs accounted for roughly $2 billion of this week’s outflow, while $1.1 billion exited mutual funds.

The four-week trailing average swung to negative $120 million, from positive $371 million last week.

The change due to market conditions this past week was an increase of $316 million. Total assets at the end of the observation period were $208.8 billion. ETFs account for about 24% of the total, at $50.8 billion. — James Passeri

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LCD comps is an offering of S&P Global Market Intelligence. LCD’s subscription site offers complete news, analysis and data covering the global leveraged loan and high yield bond markets. You can learn more about LCD here.

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Risk-On: US High Yield Bond Funds See $2.65B Investor Cash Inflow

us high yield flows

U.S. high-yield funds recorded an inflow of roughly $2.65 billion for the week ended Jan. 10, according to weekly reporters to Lipper only, marking the largest such inflow since December 2016. This follows last week’s inflow of $186 million, indicating a total inflow to high-yield funds of about $2.8 billion so far in 2018.

Mutual funds made up the bulk of this week’s inflow, taking in roughly $1.5 billion, while about $1.2 billion entered ETFs. This marks the largest inflow to mutual funds since roughly $1.9 billion for the week ended Dec. 14, 2016.

The four-week trailing average rose to positive $371 million, from negative $522 million last week, snapping a streak of ten consecutive weeks in the red.

The change due to market conditions this past week was an increase of $226 million. Total assets at the end of the observation period were $211.6 billion. ETFs account for about 25% of the total, at $52.8 billion. — James Passeri

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LCD comps is an offering of S&P Global Market Intelligence. LCD’s subscription site offers complete news, analysis and data covering the global leveraged loan and high yield bond markets. You can learn more about LCD here.