Senior Credit Analyst - Emerging Markets, EM Spreads

Leandro Gubler

Senior Credit Analyst - Emerging Markets

EM Spreads

Credit

<ul>
<li>We maintain our Outperform recommendation on YPF. Shale Expansion, Export Capacity Growth Key to Long-Term Performance</li>
<li>YPF posted weak 4Q24 results. Adjusted EBITDA dropping 38.6% QoQ and 22.5% YoY to $839 million, missing consensus by 19.7%.</li>
<li>YPF reaffirmed confidence in its strategic execution, achieving key milestones in shale operations, mature fields divestments, and fuel pricing adjustments.</li>
</ul>


We maintain our Outperform recommendation on YPF. Shale Expansion, Export Capacity Growth Key to Long-Term Performance
YPF posted weak 4Q24 results. Adjusted EBITDA dropping 38.6% QoQ and 22.5% YoY to $839 million, missing consensus by 19.7%.
YPF reaffirmed confidence in its strategic execution, achieving key milestones in shale operations, mature fields divestments, and fuel pricing adjustments.


YPF 4Q24: Macro Tailwinds and Strategic Progress Offset a Weak Quarter

<ul>
<li>The LatAm Corporate Index widened by 4 bps to 317 bps in the week ended Wednesday, January 15, 2025. </li>
<li>YPF Priced $1.1bn Bond Due 2034 at 8.5% Yield. PEMEX Commits to Settling Supplier Debts by March</li>
<li>Moody’s Upgrades Ratings of Argentine Non-Financial Companies Following Country Ceiling Adjustment</li>
</ul>


The LatAm Corporate Index widened by 4 bps to 317 bps in the week ended Wednesday, January 15, 2025. 
YPF Priced $1.1bn Bond Due 2034 at 8.5% Yield. PEMEX Commits to Settling Supplier Debts by March
Moody’s Upgrades Ratings of Argentine Non-Financial Companies Following Country Ceiling Adjustment


<ul>
<li>We recommend to “BUY” on the new YPFAR 2034 at 8.5%</li>
<li>We believe these bonds offer an appealing yield within YPF’s debt capital structure and are currently trading wide relative to the broader LatAm BB and EM BB curves</li>
<li>Pricing is expected today, with initial price talk around 8.75%, and now guided at 8.5%.</li>
</ul>


We recommend to “BUY” on the new YPFAR 2034 at 8.5%
We believe these bonds offer an appealing yield within YPF’s debt capital structure and are currently trading wide relative to the broader LatAm BB and EM BB curves
Pricing is expected today, with initial price talk around 8.75%, and now guided at 8.5%.


YPF to Price USD 9NC4 Unsecured Notes (IPT: 8.75%, Guidance: 8.50%)

<ul>
<li>We are initiating coverage on YPF with an Outperform recommendation.</li>
<li>Improving macroeconomic conditions in Argentina and YPF’s strategic focus on expanding unconventional production and investing in infrastructure, particularly export capacity, are expected to enhance its credit profile.</li>
<li>We favor the YPFDAR (Caa3/CCC/CCC) 8.500% 2029 unsecured bonds, YPFDAR 9.000% 2029 unsecured bonds, and YPFDAR 9.500% 2031 secured bonds.</li>
</ul>


We are initiating coverage on YPF with an Outperform recommendation.
Improving macroeconomic conditions in Argentina and YPF’s strategic focus on expanding unconventional production and investing in infrastructure, particularly export capacity, are expected to enhance its credit profile.
We favor the YPFDAR (Caa3/CCC/CCC) 8.500% 2029 unsecured bonds, YPFDAR 9.000% 2029 unsecured bonds, and YPFDAR 9.500% 2031 secured bonds.


Initiating Coverage on YPF: Outperform Opportunity Amid Macro and Shale Expansion

Global Editor, Base Oil News

Iain Pocock

Global Editor

Global Base Oils and Lubricants Markets

Base Oil News

Base Oil News focuses on the interplay between fundamentals and prices in the global base oils and lubricants markets.

Baseoilnews.com combines daily, weekly and monthly base oils and lubes fundamentals data from every region of the world to build the most comprehensive and up-to-date global picture of the state of the market.

The data and analysis provide key tools to understand current market developments and opportunities and to anticipate how the market is likely to behave in the coming months.

Base oils producers, lube blenders and consumers can then better plan accordingly.

Baseoilnews.com analyses and publishes market news and data every day as it breaks.

Commodities

<ul><li>Global base oils prices stay firm vs feedstock/competing fuel prices.</li><li>Firm base oils margins point to tight supply and strong demand.</li><li>Firm base oils margins incentivize refiners to raise base oils output.</li></ul>

Global base oils prices stay firm vs feedstock/competing fuel prices.Firm base oils margins point to tight supply and strong demand.Firm base oils margins incentivize refiners to raise base oils output.

Global base oils margins outlook: Week of 21 April

Argentina

YPF Sociedad Anonima is involved in the exploration, development and production of crude oil, natural gas and liquefied petroleum gas. The Company also refines, markets, and distributes oil alongside its derivatives YPF generates nearly all of its revenue inside Argentina, and has headquarters in Buenos Aires, Argentina.

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YPF SA (YPF US)

YPF 4Q24: Macro Tailwinds and Strategic Progress Offset a Weak Quarter

YPF's weak 4Q24 results show a drop in adjusted EBITDA, but the company remains confident in its strategic execution with focus on shale expansion...

Leandro Gubler

EM Spreads – Weekly News & Views

LatAm Corporate Index widens, YPF prices $1.1bn bond, PEMEX commits to settling debts, Moody's upgrades Argentine companies.

Leandro Gubler

YPF to Price USD 9NC4 Unsecured Notes (IPT: 8.75%, Guidance: 8.50%)

"Recommend buying YPFAR 2034 bonds at 8.5% yield due to attractive pricing and wide trading spread compared to LatAm and EM BB curves."

Leandro Gubler

Initiating Coverage on YPF: Outperform Opportunity Amid Macro and Shale Expansion

Initiating coverage on YPF with an Outperform recommendation due to strategic focus on expanding production and investing in infrastructure,...

Leandro Gubler

Global base oils margins outlook: Week of 21 April

Global base oils prices stay firm vs feedstock/competing fuel prices. Firm base oils margins point to tight supply and strong demand. Firm base...

Base Oil News

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

YPF 4Q24: Macro Tailwinds and Strategic Progress Offset a Weak Quarter

​YPF's weak 4Q24 results show a drop in adjusted EBITDA, but the company remains confident in its strategic execution with focus on shale expansion...

Leandro Gubler

EM Spreads – Weekly News & Views

​LatAm Corporate Index widens, YPF prices $1.1bn bond, PEMEX commits to settling debts, Moody's upgrades Argentine companies.

Leandro Gubler

YPF to Price USD 9NC4 Unsecured Notes (IPT: 8.75%, Guidance: 8.50%)

​"Recommend buying YPFAR 2034 bonds at 8.5% yield due to attractive pricing and wide trading spread compared to LatAm and EM BB curves."

Leandro Gubler

Initiating Coverage on YPF: Outperform Opportunity Amid Macro and Shale Expansion

​Initiating coverage on YPF with an Outperform recommendation due to strategic focus on expanding production and investing in infrastructure,...

Leandro Gubler

Global base oils margins outlook: Week of 21 April

Global base oils prices stay firm vs feedstock/competing fuel prices. Firm base oils margins point to tight supply and strong demand. Firm base...

Base Oil News

YPF's weak 4Q24 results show a drop in adjusted EBITDA, but the company remains confident in its strategic execution with focus on shale expansion...

LatAm Corporate Index widens, YPF prices $1.1bn bond, PEMEX commits to settling debts, Moody's upgrades Argentine companies.

"Recommend buying YPFAR 2034 bonds at 8.5% yield due to attractive pricing and wide trading spread compared to LatAm and EM BB curves."

Initiating coverage on YPF with an Outperform recommendation due to strategic focus on expanding production and investing in infrastructure,...