The credit quality of debt issued by the FAANG stock companies - Facebook, Amazon, Apple, Netflix and Google (Alphabet) – slid in 2018 relative to recent history, with about one-fifth of the bonds rated below investment grade. Between 2014 and 2017, the tech company cohort saw between 4% and 11% of their debt rated below investment grade. While a greater proportion of the bonds issued so far in 2018 is junk rated, the overall amount of debt sold has declined significantly. The FAANGs issued about $39 billion so far in 2018, down from $149 billion the year before and an average $53.7 billion annually for the three years ended 2016. Netflix announced early Monday that it is looking to raise another $2 billion via the high-yield debt market to fund new content in addition to the already outstanding $5 billion in debt tied to the company.
A brief look at the total U.S. corporate bond market shows a steady 75/25 split between investment-grade debt and below-investment-grade issues.