Long Credit Example

Long Credit Example - Nucor Corporation 12/28/2010 Analyst...

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Nucor Corporation 12/28/2010 Analyst Opinion: Outlook: Analyst: Nguyen Bui CUSIP: BFG Purchase Date: Original Par: Current BFG Book Value: BFG Book Price: BFG Impairment Coupon: Maturity: Market Price: 52-Week Range: Equity Price: $7.21 (12/29/2010) 52-Week Range: $5.04-9.45 Symbol/Ticker: BLC Ratings: B1/Stable (3/4/2009) // B/Stable (6/21/2010) CDS Value: 145 bps. CDS Implied Default Probability: 5.61% Moody’s Default Probability: 8.71% Page 1
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Nucor Corporation 12/28/2010 Recovery Rating: 6 (0-10% Recovery) Headquarters: Dallas, TX Recommendation: Belo Corporation (BLC) is a “hold” with a negative outlook. Heightened Awareness Watch List: NO Impairment: NO Impairment Taken to Date: 35% ($1,050,000) Recommended Impairment: NONE Belo owns 20 TV stations in 15 large and midsize TV markets, reaching about 14% of the nation’s households. Station affiliations are well diversified among the major TV networks. Belo‘s TV stations rank first or second in audience share in 12 of its 15 markets. Belo spun off its newspaper business on February 8, 2008, and is since a pure-play television company. The broadcasting and TV industry heavily depends on advertisers for revenue. 41% of revenue comes from Texas and the top revenue source is from auto advertising. The Company has paid down its debt by 15% in the last two years and its debt/EBITDA was 4.8x as of September 30, 2010, down from 6.8x at the end of 2009. Belo posted a profit for the trailing twelve months for the first time in several years. Revenue increased 3.7% for the trailing twelve months. Belo’s management is focused on debt reduction and building financial flexibility. The Company was able to raise more than $200 mm from public market debt sales in 2009. Belo is one of the largest pure-play, publicly-traded television companies. The Company has acquired and built a strong portfolio of stations. Because of the relatively short maturity, the Company’s strong business model, and this issue being the next maturity for the Company, this issue is a “Hold” with a negative outlook. Page 2
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Nucor Corporation 12/28/2010 Highlights: Belo Corporation, a Delaware corporation, began as a Texas newspaper company in 1842 and today is one of the nation’s largest publicly-traded pure-play television companies. The Company owns 20 television stations (nine in the top 25 U.S. markets) that reach 14 percent of U.S. television households, including ABC, CBS, NBC, FOX, CW and MyNetwork TV (MNTV) affiliates, and their associated Web sites, in 15 highly-attractive markets across the United States. The Company also owns two local and two regional cable news channels and holds ownership interests in two other cable news channels. The Company believes the success of its media franchises is built upon providing the highest quality local and regional news, entertainment programming and service to the communities in which they operate. These principles have built durable relationships with
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This note was uploaded on 11/22/2011 for the course FINANCE BUS M 497R taught by Professor Kimsmith during the Fall '11 term at BYU.

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Long Credit Example - Nucor Corporation 12/28/2010 Analyst...

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