Jefferies Insights - January 2019

As part of the firm’s daily communication with clients, Jefferies regularly publishes perspectives, ideas and insights on the markets and our areas of focus through research reports, trend analysis, white papers and industry commentary, as well as strategy and economic thought pieces.

Economics and Strategy

• Flip-Flop, Flip-FLOP
• Sentiment Shifts
• U.S. Outlook – 2019: Next Phase of Monetary Policy Normalization, Political Uncertainty and the Ongoing Trade War
• European Outlook – Ending QE Was Easy, Normalizing ECB Policy Won’t Be: Challenges Around Timing, Personnel Changes and Global Spill-overs; Brexit is the Great Disruptor

Actionable Ideas for Companies and Sponsors

• SPACs Becoming a Viable Competitor for Significant M&A Transactions
• M&A Exit Through a 144A Equity Placement
• Opportunities for Financial Sponsors in a Tightening Market for Leverage
• Structuring Financings to Provide Flexibility Around the Junior Portion of the Capital Structure
• Improving High Yield Bond Execution by Incorporating Concurrent Convertible Bond Issuance
• Non-Fungible Incremental Add-ons
• Direct Private Investments by Pension Funds and Endowments Continue to Grow
• Optimizing Convertible Issuance Through Concurrent Private Convertible Repurchases
• Convertible Market Remains Resilient and Terms Remain at Historically Attractive Levels
• “Deemed Dividend” Tax Changes Enhance Financing & Liability Management Options for Stressed Companies

Best Research Ideas

• U.S. Insights – Housing: Needs a New Front Door, Not a Teardown
• Biotechnology – Three Emerging Positive Trends to Watch in China: Opening Up Huge Long-term Market Opportunity
• Honeywell International – Deep Dive: Going the Distance with Aerospace & Defense Firepower
• European Pharmaceuticals – Set to Capitalise on Taking its Medicine
• Renault – House of Cars, Season 3: Upgrade to Buy
• Telecom Services - Investor Guide to China’s 5G Scenarios: Short-term Pain for Long-term Gain
• Gas Utilities - Navigating the CGD wave, Initiating on Guj Gas with BUY; IGL top pick, MGL UNPF