GO
Loading...

Enter multiple symbols separated by commas

Microsoft Debt Sale a Smart Idea

Reports that Microsoft may be planning a debt sale to pay dividends and buybacks makes perfect sense. Think of it this way: why not add leverage?

1) debt is cheap

2) company thinks its stock is undervalued

3) they are sitting on an enormous pile of cash: $42 billion

4) they can issue a large amount of additional debt — say, $10 billion — at insanely low rates.

Why not add leverage?

And they are just the latest. I mentioned earlier today that trading desks were telling me about corporate bond deals coming soon from:

Deere ,

Royal Bank of Scotland ,

Amgen ,

Comerica ,

Entergy and

Southern .

— And new high-yield offerings from Borg Warner , BE Aerospace , Huntsman, and others.

_____________________________
Bookmark CNBC Data Pages:

_____________________________

_____________________________

Questions? Comments? tradertalk@cnbc.com