NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) releases its outlook for U.S. corporate credit in 2020, which is viewed as stable, but more vulnerable today than it was heading into 2019. KBRA’s opinion is based on what it believes will be continued strong operating fundamentals—corporate profit margins that remain above the long-term average, decent top-line growth, as well as manageable financial risk—overlaid with heightened and worrisome geopolitical risk.
While this still leaves us in a favorable part of the credit cycle, creditor-unfriendly headwinds are mounting. U.S. economic growth, forecast at below 2% in 2020 and 2021, has joined the rest of the world in what the International Monetary Fund refers to as a “synchronized global slowdown.” And while there is some evidence of the world coming out of this (modestly), a less favorable economic backdrop will likely continue to lean on corporate profits growth, which has struggled to break out in recent years.
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About KBRA and KBRA Europe
KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.