High Yield Valuations: Learning to Fly

We have previously expressed our opinion that the recent spate of shipping issues will soon allow the industry to achieve the critical mass necessary for it to take a permanent position in the high yield markets. In our opinion, the biggest threat to this happening is not equity-thin deals from questionable sponsors coming to market – we believe that the rating agencies and investors can smell them and punish accordingly. No, we are most concerned over a loss of investor and rating agency confidence in appraised vessel values and its impact on future deals.

High yield deals sink or swim on the basis of their cashflows, but recent superficial headlines have focused on the subject of valuations.

This is only an excerpt of High Yield Valuations: Learning to Fly

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