Fitch Solutions: CDS on Smithfield Strengthen Ahead of Earnings

Tighter credit default swap (CDS) spreads on Smithfield Foods Inc. are indicating increased market confidence, according to Fitch Solutions in its latest earnings commentary.

CDS on Smithfield (reporting Thursday) have tightened 17% over the past three months, notably outperforming the broader North America food and beverage sector (9% tighter on average). CDS for Smithfield also became less liquid over the past quarter, falling from the ninth regional percentile to the 16th. 'Improved market sentiment is likely being buoyed by Smithfield's debt reduction and record operating performance,' said Author and Director Diana Allmendinger.

Companies reporting this week include the following:

First Industrial LP (FINANCIALS/Real Estate Investment Trusts)

Credit spreads have tightened over the last three months, with the five-year point tightening from 446 basis points (bps) to 373 bps, a decrease of -16%. The liquidity score on First Industrial LP decreased from 9 to 8.26 over the three-month period, causing an increase in liquidity from trading in the 58th percentile to the 50th percentile.

Navistar International Corporation (INDUSTRIALS/Industrial Engineering)

Credit spreads have tightened over the last three months, with the five-year point tightening from 496 bps to 487 bps, a decrease of -2%. The liquidity score on Navistar International Corporation decreased from 8.64 to 8.41 over the three-month period, causing a decrease in liquidity from trading in the 51st percentile to the 54th percentile.

Smithfield Foods, Inc. (CONSUMER GOODS/Food Producers)

Credit spreads have tightened over the last three months, with the five-year point tightening from 389 bps to 322 bps, a decrease of -17%. The liquidity score on Smithfield Foods, Inc. decreased from 7.19 to 6.93 over the three-month period, causing a decrease in liquidity from trading in the ninth percentile to the 16th percentile.

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Fitch Solutions, a division of the Fitch Group, focuses on the development of fixed-income products and services, bringing to market a wide range of data, analytical tools and related services. The division is also the distribution channel for Fitch Ratings content.

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Contacts:

Fitch Ratings
Diana Allmendinger
Director
[phone]
Fitch Solutions, 33 Whitehall Street, New York, NY 10004
or
Media Relations
Peter Fitzpatrick, London
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Email: [e-mail]
Sandro Scenga, New York
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