Saturday, April 10, 2021

Recent Red Rock Biofuels Bond Sale Prices Are Concerning to Me.

I'm by no means an expert on revenue bonds or bond pricing but recent trades on Red Rock Biofuel bonds are of concern to me. 

For a bond that was issued with a 2031 maturity and a coupon rate of 6.5% the most recent sales prices for $21 million in bonds in April were in the 14.75% -21.25% range. 

This means that the yield of these bonds must be substantially above 6.5%. 

I calculate yield to maturity of well over 30% but as I mentioned I am not an expert and I encourage you to do your own assessment and calculation. 

The EMMA Oregon State Business Development Department Issuer page can be found HERE.

Originally created and posted on the Oregon Housing Blog.  

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