This article first appeared on GuruFocus .
SoftBank Group ( SFTBY ) shares tumbled 10.8% to 3,549 yen at Friday's November 6 close in Tokyo, as the cost of insuring its debt jumped to the highest level in four years. The shares have lost close to half their value since early September. This is no longer just an equity story.
SoftBank's five-year credit default swap spread rose as high as 466 basis points, the widest since October 2022, which Markit data implies is a 30.6% default probability. The group holds a $64.6 billion stake in OpenAI and 90% of Arm, and it finances data centers through SB Energy. OpenAI has pushed its IPO to 2027, and SB Energy's listing has reportedly slipped to December or later, delaying two potential sources of cash.
The GuruFocus chart shows a GF Score of 76/100, with Momentum at 8/10 and Profitability at 6/10, while Financial Strength is weak at 3/10. That weak balance-sheet score fits what the credit market is signaling. SoftBank reports results on November 10; investors will look for any change to its loan-to-value ratio and funding plans.
