According to Barclays analyst Chris Buck, investors willing to
add exposure to debt by Petróleo Brasileiro SA will benefit from
buying existing bonds with maturities between 2018 and 2021,
rather than simply waiting for a new issue. According to a note,
Buck said Barclays's preferred bonds by Petrobras, as the
company is known, include the 5.875 percent notes due in 2018,
the 7.875 percent bond due in 2019, the 5.75 percent due in 2020
and the 5.375 percent maturing in 2021.
While the fundamental outlook for the credit "remains
challenging, with limited additional production in 2013 and
2014," Buck does not expect Petrobras to increase leverage
materially. "Despite concerns about the fundamental outlook, we
view Petrobras as a quasi-sovereign with significant implied
government support," he said, adding that "this limits the
potential for spread widening."
Recent underperformance has probably made price for those
bonds a little more attractive now, he said in the note.