Bond funding options get some of their luster back

Last week, we told you that hospital giant HCA was jumping back into the bond market with a $1.5 billion offering. Like other companies, HCA had stayed away from the bond market for some time. Investors were expecting bond issuers to pay whopping returns of as much as 20 percent as recently as March. This time, however, HCA offered an 8.5 percent return.

All told, it looks like the bond market is actually beginning to stabilize, and investors are coming back to the table. We're not talking only institutional players but also retail investors, observers say. During the period of April 8-15, investors moved $5.2 billion from stock mutual funds and plunked down $27 million into bond funds, according to one investment research house.

Now, the question is whether other hospital companies, already struggling to complete capital projects, will be able to take advantage of these market conditions. After all, there's a lot of hospitals whose credit has taken a beating during the recession.

To learn more about this trend:
- read this Forbes piece

Related Articles:
Moody's downgrades 18 hospital bond ratings in two months
Moody's says healthcare's vulnerable to economy's ills
Obama healthcare plan a plus for hospitals, Moody's says
Moody's ratings changes could raise healthcare credit ratings
Bond buy-backs could stress hospitals' liquidity, Moody's says

Post a comment