Tom, I love the question! I’m not aware of any niche ETF of offshore credits like this but wish something like that existed. I’m only aware of general high yield ETF’s like JNK and HYG
I did a little research on Gemini. BondBloxx US High Yield Energy Sector (ticker: XHYE) comes close. Lots of Bb/B paper from offshore names including NE and RIG but weighted toward VG right now. Very low volume traded daily but there it is! Reasonable .35% expense ratio.
Thanks for finding. You’re right to note Venture Global — it’s a huge issuer in HY energy. I think a key in credit is to avoid the losers bc downside can be large. Venture Global is one to watch, it’s why I put the VNGLNG ticker on this article’s chart. I think the Plaquemines and Calcasieu level bonds are OK but further you move from the assets I get uncomfortable due to AI demand potentially increasing natgas feedstock prices. I don’t follow Venture Global too closely bc my offshore focus but definitely one to watch if you are in the ETF. Thanks for the note, Tom
Ankush, you’re correct to mention this. I heard that as well but can’t be sure there’s not other expenses beyond SG&A here. Wilson Sons is >50% EBITDA margin ?? when their larger local competitor is high 40%-50% and Tidewater is closer to low 40% range (could be due to region)? Could be contracts and rates explaining differences.
TDW chose not to give EBITDA, and instead gave pieces to the puzzle instead. Made me think they were leaving something out but tough to say.
Tommy, thanks. Do you know of any ETFs that include some of the high yield bonds mentioned above?
Tom, I love the question! I’m not aware of any niche ETF of offshore credits like this but wish something like that existed. I’m only aware of general high yield ETF’s like JNK and HYG
I did a little research on Gemini. BondBloxx US High Yield Energy Sector (ticker: XHYE) comes close. Lots of Bb/B paper from offshore names including NE and RIG but weighted toward VG right now. Very low volume traded daily but there it is! Reasonable .35% expense ratio.
Thanks for finding. You’re right to note Venture Global — it’s a huge issuer in HY energy. I think a key in credit is to avoid the losers bc downside can be large. Venture Global is one to watch, it’s why I put the VNGLNG ticker on this article’s chart. I think the Plaquemines and Calcasieu level bonds are OK but further you move from the assets I get uncomfortable due to AI demand potentially increasing natgas feedstock prices. I don’t follow Venture Global too closely bc my offshore focus but definitely one to watch if you are in the ETF. Thanks for the note, Tom
Thanks for this -
I thought TDW guided for Wilson Sons at $220m revenue, 58% GM and $14m SG&A - so $113m EBITDA… maybe I missed something?
Ankush, you’re correct to mention this. I heard that as well but can’t be sure there’s not other expenses beyond SG&A here. Wilson Sons is >50% EBITDA margin ?? when their larger local competitor is high 40%-50% and Tidewater is closer to low 40% range (could be due to region)? Could be contracts and rates explaining differences.
TDW chose not to give EBITDA, and instead gave pieces to the puzzle instead. Made me think they were leaving something out but tough to say.