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Haines says 'we are a long ways' from Iran returning to nuclear deal

·1 min read

WASHINGTON, Jan 19 (Reuters) - U.S. President-elect Joe Biden's nominee to be the Director of National Intelligence, Avril Haines, said on Tuesday "we are a long ways" from Iran coming back into strict compliance with the Iran nuclear deal and she supports taking an aggressive stance toward the threat from China.

"(Biden) has indicated that if Iran were to come back into compliance, that he would direct that we do so as well. And I think, frankly, that we are a long ways from that," Haines told lawmakers. "Our approach to China has to evolve and essentially meet the reality of the particularly assertive and aggressive China that we see today ... I do support an aggressive stance, in a sense, to deal the challenge that we are facing." (Reporting By Mark Hosenball and Arshad Mohammed; Writing by Arshad Mohammed)

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  • 2 Big Dividend Stocks Yielding at Least 10%; Here’s What You Need to Know

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During the fourth quarter of 2020, Ready Capital closed loans totaling $225 million for projects in 11 states. The projects include refinancing, redevelopment, and renovations. Fourth quarter full results will be reported in March. The extent of Ready Capital’s confidence can be seen in the company’s recent announcement that it will merge with Anworth Mortgage in a deal that will create a $1 billion combined entity. In the meantime, investors should note that Ready Capital announced its 4Q20 dividend, and the payment was increased for the second time in a row. The company had slashed the dividend in the second quarter, when COVID hit, as a precaution against depressed earnings, but has been raising the payment as the pandemic fears begin to ease. The current dividend of 35 cents per share will be paid out at the end of this month; it annualizes to $1.40 and gives a sky-high yield of 12%. 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Shares in this REIT are selling for $11.57 while the average price target stands at $13.63, indicating room for ~18% upside growth in the coming year. (See RC stock analysis on TipRanks) Nustar Energy LP (NS) The energy and liquid chemical markets may not seem like natural partners, but they do see a lot of overlap. Crude oil and natural gas are highly hazardous to transport and store, an important attribute they share with industrial chemicals and products like ammonia and asphalt. Nustar Energy is an important midstream player in the oil industry, with more than 10,000 miles of pipeline, along 73 terminal and storage facilities. The relatively low oil prices of the past two years have cut into the top and bottom lines of the energy sector – and that is without accounting for the COVID pandemic’s hit to the demand side. These factors are visible in Nustar’s revenues, which fell off in the first half of 2019 and have remained low since. 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NS benefits from a resilient refined products footprint, exposure to core acreage in the Permian basin, a foothold in the burgeoning renewable fuels value chain, as well as strategic Corpus Christi export assets… we think NS is a compelling investment idea over the next 12 months.” Chen sets a $20 price target on the stock, backing her Overweight (i.e. Buy) rating and suggesting ~27% upside for the year. (To watch Chen’s track record, click here) Interestingly, in contrast to Chen's bullish stance, the Street is lukewarm at present regarding the midstream company's prospects. Based on 6 analysts tracked by TipRanks in the last 3 months, 2 rate NS a Buy, 3 suggest Hold, and one recommends Sell. The 12-month average price target stands at $16.40, marking ~5% upside from current levels. 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That was the immediate cause of the restructuring announcement.A longer view reveals a steady decline in the company’s finances since the government re-nationalized it in 2012 and forced it to swell payrolls, artificially hold down domestic fuel prices and skimp on investments, leading to four straight years of oil-and-gas output declines.YPF must now reach a deal with creditors to get its finances in order to boost investment in the gas-rich Vaca Muerta shale formation in Patagonia.The task is even more urgent as the South American winter approaches with YPF unable to meet domestic gas demand, meaning Argentina will have to boost imports -- and fork over precious hard currency -- in the middle of a global spike in prices.“The central bank’s decision really put YPF between a rock and a hard place,” said Lorena Reich, a corporate-debt analyst at Lucror Analytics in Buenos Aires.Officially, YPF says that the swap is voluntary and that it will continue to pay all its bonds whether they are exchanged or not. But that’s certainly not how investors understand the situation, and ratings companies say the proposal constitutes a distressed exchange that would be tantamount to default.Overall, YPF is seeking to restructure $6.2 billion of bonds, pushing back a total of $2.1 billion in debt payments through the end of next year so that it can invest the money in bolstering production. The deal offers investors a slight upside from current bond prices, but would stick creditors with losses of as high as 16% on a net-present-value basis, according to calculations by Portfolio Personal Inversiones, a local brokerage.While some investors had anticipated YPF would try to refinance its short-term debt -- without imposing any losses -- the plan to restructure virtually all the company’s overseas bonds was a big surprise.“The offer crossed the line of reason,” said Ray Zucaro, the chief investment officer at RVX Asset Management in Miami, who owns YPF bonds. “There was no reason they needed to include all the bonds when they only needed relief on the short-dated notes.”YPF says it included all its securities in the swap to give all its bondholders a fair shot at exchanging into a new export-backed note maturing in 2026 that offers more protection than unsecured debt.Creditors have begun to form groups to negotiate the terms of the restructuring, and while the talks haven’t begun in earnest, the company says it’s willing to negotiate. On Jan. 14, YPF amended some of the rules for its consent solicitation after investor outcry over a procedural issue.Cash CrunchArgentina’s cash crunch couldn’t come at a worse time for YPF, which was already facing a drop in demand because of the pandemic. The driller needs more investment to ramp up capital-intensive shale production in Vaca Muerta as aging traditional fields decline. It’s expected to spend $2.2 billion in 2021 after last year’s paltry $1.5 billion. But that’s still a far cry from the more than $6 billion a year it invested in the wake of the nationalization.As the company looks for savings in the bond market, it’s also slashing other costs, cutting salaries and reducing its bloated workforce by 12%. It’s trying to sell stakes in some oil fields, as well as its headquarters in Buenos Aires, a sleek glass skyscraper where executives take calls looking out over the vast River Plate estuary into Uruguay.Founded in 1922 as one of the world’s first entirely state-run oil companies, YPF was passed from nationalist governments to military dictatorships until the early 1990s, when it was sold to Madrid-based Repsol SA as part of a short-lived attempt to free up the economy. In 2012, President Cristina Fernandez de Kirchner’s leftist government expropriated 51% of the company, eventually paying Repsol $5 billion in bonds for its stake. YPF’s market value today is just $1.6 billion.The central bank’s refusal to sell YPF the dollars it needs to pay its obligations, despite the company’s earlier efforts to refinance its short-term debt, is a bad sign for all overseas corporate bonds from Argentina, according to the financial services firm TPCG. The concern is that if the country’s flagship company isn’t eligible to buy dollars at the official exchange rate as the bank seeks to hold onto hard-currency reserves, no one else will be either.“The central bank’s message is pretty clear,” said Santiago Barros Moss, a TPCG analyst in Buenos Aires. “There just aren’t enough dollars in Argentina for corporates right now.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

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