The markets continue to react to the political unrest in Libya and surrounding countries. The price of crude oil is at lofty levels, and prices at the pump are similarly high. Eventually, all consumers will feel the effects of the turmoil because the supply and cost of oil affect all necessary consumer goods, which could stymie the recovery in our economy. Still, the phenomenal rise in equities in the past year continues to fuel the value of convertible securities. And investors, uncertain about stocks, look toward safer havens such as convertibles because they like the options offered.
Our proprietary model rates convertibles in our database, pointing out which issues are suitable for purchase and which should be sold depending on market conditions and company-specific factors. This week our recommendations include Buy, Sell, and Hold advice about:
1. Orbital Sciences (ORB) 2.4375% convertible notes due 2027;
2. Archer-Daniels (ADM) Series A mandatory convertible preferred stock;
3. Mentor Graphics (MENT) 6.25% convertible notes due 2026; and
4. NuVasive (NUVA) 2.25% convertible notes due 2013.
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.