Key Takeaways
- Two new fallen angels in December raised the total count for 2020 to 49. Meanwhile, global fallen angel default rates ended the year at 1.4%, slightly down from the decade-high of 1.8% in September and far below those seen during 2008-2009 (at 6.5%).
- There were no new potential fallen angels in December, and only one stayed on CreditWatch, signifying less immediate downgrade risk. Potential fallen angels with negative outlooks typically have a one-in-three chance of a downgrade within two years of receiving the negative outlook.
- While broadly improved, potential fallen angels as a proportion of investment-grade issuers remained in the double digits for many sectors that could face weak revenue generation due to the COVID-19 pandemic or low energy demand.
- Nine sectors (including media and entertainment, transportation, and aerospace and defense) had a higher proportion of fallen angels to investment-grade issuers in December 2020 than at the peak of the global financial crisis.
The Proportion Of Fallen Angels To Investment-Grade Credits Is Stable
December saw two new fallen angels--automobile and aerospace company GKN Holdings Ltd. and Innergex Renewable Energy Inc.--bringing the total number in 2020 to 49. Fallen angels are issuers downgraded to speculative grade ('BB+' or below) from investment grade ('BBB-' or above). Reflecting the global macro trend of gradual recovery in the previous months, the ratio of fallen angels to investment-grade issuers was stable in the second half of the year.
Chart 1
Nonetheless, the challenges brought by 2020--with the oil price collapse in the earlier months and the pandemic throughout the year--have unsurprisingly led to a rise in the global 12-month trailing default rate among fallen angels to 1.4%, from 0.4% at the end of 2019. This is just under the decade-high of 1.8% in September, but remains far below the more than 6% at the peak of the global financial crisis. In light of renewed COVID-19 lockdowns, default risks could remain fairly elevated for some time, despite the stabilizing fallen angel count.
Chart 2
Potential Fallen Angels Count Eases, But Challenges Linger
On a positive note, we ended 2020 with 99 potential fallen angels (issuers rated 'BBB-' with negative outlooks or ratings on CreditWatch with negative implications), down from the historical high of 126 in May and June, and from 107 in our last report. Aside from the two issuers that became fallen angels in December, three potential fallen angels were removed from the list due to the issuers requesting to withdraw the ratings, one because it no longer had outstanding rated debt, and two after their outlooks were revised to stable. There were no new potential fallen angels in December.
Chart 3
Only one potential fallen angel is currently on CreditWatch with negative implications, down from 26 of the 96 potential fallen angels in April. This points to less immediate credit risk and, potentially, a slower pace of new fallen angels in the near term. The estimated timeframe of a potential downgrade is 90 days for a negative CreditWatch, compared with six to 24 months for a negative outlook (see "Guide To Credit Rating Essentials, What Are They And How Do They Work?"). Put differently, a negative outlook potentially leaves more time for the issuer to recover from current challenges.
Despite the improvements, credit risks remain elevated. Not only are there still 99 potential fallen angels, but most sectors have a somewhat high number of fallen angels as a share of their investment-grade credits. In five out of the 19 sectors we track, these ratios are in double digits: building materials (10%), transport (13%), aerospace/defense (14%), autos (16%), and media and entertainment, including lodging and leisure (28%). Nine sectors have higher ratios as of December 2020 than they had at the peak of the global financial crisis.
Chart 4
2020 Ended With The Lowest Number Of Rising Stars On Record
There were no new additions to rising stars and potential rising stars (issuers rated 'BB+' with positive outlooks or ratings on CreditWatch with positive implications) in December. The year thus ended with only seven rising stars, the lowest number since we began tracking the data in 1987, which highlights that, despite gradual improvements on the potential fallen angels count, we are still far from normal.
Chart 5
Related Research
- Gas Natural de Lima y Callao S.A. (calidda) ‘BBB-‘ Issuer Credit And Issue-Level Ratings Withdrawn at Issuer’s Request, Dec. 23, 2020.
- GKN Holdings Ltd. Downgraded To ‘BB+’ On Pressured Profitability And Weaker Credit Metrics; Outlook Stable, Dec. 22, 2020.
- Innergex Renewable Energy Inc. Rating Lowered To ‘BB+’ From ‘BBB-‘; Preferred Share Rating Lowered To ‘B+’ From ‘BB’, Dec. 17, 2020.
- Ashtead Group Outlook Revised To Stable On Resilient Performance Through The COVID-19 Pandemic; 'BBB-' Ratings Affirmed, Dec. 15, 2020.
- PT Perusahaan Gas Negara Tbk. ‘BBB-‘ Ratings Withdrawn At The Company’s Request, Dec. 14, 2020.
- Ohio National Financial Services, Subs Downgraded, Outlook Stable; Ratings Withdrawn, Dec. 12, 2020.
- Iron Ore Producer Vale S.A. Outlook Revised To Stable From Negative On Better Credit Metrics; ‘BBB-‘ Ratings Affirmed, Dec. 11, 2020.
Appendix
Table 1
Two New Fallen Angels In December Raised The 2020 Count To 49 | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Date | Issuer | To | From | Sector/subsector | Country | Rated debt affected (mil. US$) | ||||||||
22-Dec-2020 | GKN Holdings Ltd. | BB+ | BBB- | Automotive | U.K. | 1,012 | ||||||||
16-Dec-2020 | Innergex Renewable Energy Inc. | BB+ | BBB- | Merchant power | Canada | 125 | ||||||||
30-Oct-2020 | FirstEnergy Corp. | BB+ | BBB | Utilities | U.S. | 18,373 | ||||||||
12-Oct-2020 | EPR Properties | BB+ | BBB- | Homebuilders/real estate companies | U.S. | 3,486 | ||||||||
22-Sep-2020 | Southeast Supply Header, LLC | BB+ | BBB- | Midstream | U.S. | 400 | ||||||||
21-Sep-2020 | Minsur S.A. (Breca Mineria S.A.C. and Subsidiaries) | BB+ | BBB- | Metals, mining, and steel | Peru | 450 | ||||||||
9-Sep-2020 | Howmet Aerospace Inc | BB+ | BBB- | Aerospace and defense | U.S. | 7,182 | ||||||||
3-Sep-2020 | Nordstrom Inc. | BB+ | BBB- | Retail/restaurants | U.S. | 3,566 | ||||||||
17-Aug-2020 | Accor S.A. | BB+ | BBB- | Media and entertainment | France | 5,490 | ||||||||
31-Jul-2020 | Valeo S.A. | BB+ | BBB- | Automotive | France | 4,108 | ||||||||
20-Jul-2020 | IHO Verwaltungs GmbH | BB+ | BBB- | Automotive | Germany | 8,608 | ||||||||
14-Jul-2020 | Zijin Mining Group Co. Ltd. | BB+ | BBB- | Metals, mining, and steel | China | 350 | ||||||||
9-Jul-2020 | Emaar Properties PJSC | BB+ | BBB- | Homebuilders/real estate companies | U.A.E. | 3,250 | ||||||||
9-Jul-2020 | DIFC Investments Ltd. | BB+ | BBB- | Homebuilders/real estate companies | U.A.E. | 1,400 | ||||||||
8-Jul-2020 | Braskem S.A. (Odebrecht S.A.) | BB+ | BBB- | Chemicals, packaging, and environmental services | Brazil | 4,150 | ||||||||
26-Jun-2020 | Axis Bank Ltd. | BB+ | BBB- | Financial institutions | India | 1,095 | ||||||||
23-Jun-2020 | Carnival Corp. | BB- | BBB- | Media and entertainment | Panama | 9,265 | ||||||||
15-Jun-2020 | Tech Data Corp. | BB | BBB- | High technology | U.S. | 3,750 | ||||||||
15-Jun-2020 | Embraer S.A. | BB+ | BBB- | Aerospace and defense | Brazil | 500 | ||||||||
28-May-2020 | Rolls-Royce PLC (Rolls-Royce Holdings PLC) | BB | BBB- | Aerospace and defense | U.K. | 3,996 | ||||||||
26-May-2020 | Multibank Inc. y Subsidiarias | BB+ | BBB | Financial institutions | Panama | 300 | ||||||||
22-May-2020 | Trinity Industries Inc. | BB+ | BBB- | Transportation | U.S. | 400 | ||||||||
20-May-2020 | International Consolidated Airlines Group, S.A. | BB | BBB- | Transportation | Spain | 1,086 | ||||||||
20-May-2020 | Deutsche Lufthansa AG | BB+ | BBB- | Transportation | Germany | 1,086 | ||||||||
20-May-2020 | British Airways PLC | BB | BBB- | Transportation | U.K. | 806 | ||||||||
20-Apr-2020 | Hillenbrand Inc., | BB+ | BBB- | Capital goods | U.S. | 1,250 | ||||||||
10-Apr-2020 | Rockies Express Pipeline LLC | BB+ | BBB- | Midstream | U.S. | 2,050 | ||||||||
9-Apr-2020 | Renault S.A. | BB+ | BBB- | Automotive | France | 24,979 | ||||||||
3-Apr-2020 | ZF Friedrichshafen AG | BB+ | BBB- | Automotive | Germany | 7,027 | ||||||||
2-Apr-2020 | Service Properties Trust | BB+ | BBB- | Homebuilders/real estate companies | U.S. | 5,350 | ||||||||
2-Apr-2020 | Royal Caribbean Cruises Ltd. | BB | BBB- | Media and entertainment | U.S. | 1,750 | ||||||||
27-Mar-2020 | Continental Resources Inc. | BB+ | BBB- | Oil and gas | U.S. | 5,200 | ||||||||
27-Mar-2020 | Esselunga SpA | BB+ | BBB- | Retail/restaurants | Italy | 1,105 | ||||||||
27-Mar-2020 | Trinidad Generation Unlimited | BB+ | BBB- | Utilities | Trinidad and Tobago | 600 | ||||||||
26-Mar-2020 | Apache Corp. | BB+ | BBB | Oil and gas | U.S. | 11,080 | ||||||||
26-Mar-2020 | Western Midstream Operating LP (Occidental Petroleum Corp.) | BB+ | BBB- | Midstream | U.S. | 8,120 | ||||||||
26-Mar-2020 | Marks & Spencer PLC (Marks & Spencer Group PLC) | BB+ | BBB- | Retail/restaurants | U.K. | 2,068 | ||||||||
26-Mar-2020 | Patterson-UTI Energy Inc., | BB+ | BBB | Oil and gas | U.S. | 875 | ||||||||
25-Mar-2020 | Ford Motor Co. | BB+ | BBB- | Automotive | U.S. | 113,862 | ||||||||
25-Mar-2020 | Occidental Petroleum Corp. | BB+ | BBB | Oil and gas | U.S. | 43,913 | ||||||||
24-Mar-2020 | Delta Air Lines Inc. | BB | BBB- | Transportation | U.S. | 4,550 | ||||||||
23-Mar-2020 | Immobiliare Grande Distribuzione SIIQ S.p.A. | BB+ | BBB- | Homebuilders/real estate companies | Italy | 855 | ||||||||
24-Feb-2020 | Ruby Pipeline LLC | BB | BBB- | Midstream | U.S. | 825 | ||||||||
18-Feb-2020 | Macy's Inc. | BB+ | BBB- | Retail/restaurants | U.S. | 7,149 | ||||||||
14-Feb-2020 | Kraft Heinz Co. (The) | BB+ | BBB- | Consumer products | U.S. | 31,539 | ||||||||
4-Feb-2020 | EQM Midstream Partners LP | BB+ | BBB- | Utilities | U.S. | 3,500 | ||||||||
3-Feb-2020 | EQT Corp. | BB+ | BBB- | Utilities | U.S. | 4,945 | ||||||||
31-Jan-2020 | Spirit AeroSystems Inc. | BB | BBB- | Aerospace and defense | U.S. | 1,900 | ||||||||
13-Jan-2020 | Atlantia SpA | BB- | BBB- | Utilities | Italy | 16,297 | ||||||||
Data as of Dec. 31, 2020. Fallen angels are defined as investment-grade issuers currently with bonds outstanding that have been downgraded into speculative-grade (i.e. from 'BBB-' or above to 'BB+' or below). Includes all rated issuers with valid outstanding debt at the time of the rating action. Valid debt includes issuer-level debt (both secured and unsecured), bank loans, subordinated debt, medium-term notes, preferred stock, convertible debt and drawdowns under MTN programs and excludes commercial paper programs, shelf registrations, certificates of deposit, and debt rated on a confidential basis. Source: S&P Global Ratings Research. |
Table 2
Potential Fallen Angels Count Drops Below 100, Only One Issuer Placed On CreditWatch Negative | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
'BBB-' rated issuers with negative outlooks or on creditwatch with negative implications | ||||||||||||||
Subsector | Issuer | CreditWatch negative/negative outlook | New to the list this month | Country | Region | Debt amount (mil. US$) | ||||||||
Financial institutions | AIB Group PLC | Negative | Ireland | Europe | 7,419 | |||||||||
Utilities | Abertis Infraestructuras S.A. | Negative | Spain | Europe | 20,735 | |||||||||
Financial institutions | Ally Financial Inc. | Negative | U.S. | U.S. | 18,322 | |||||||||
Media and entertainment | Amadeus IT Group S.A. | Negative | Spain | Europe | 4,903 | |||||||||
Metals, mining, and steel | ArcelorMittal | Negative | Luxembourg | Europe | 13,418 | |||||||||
Financial institutions | Argo Group International Holdings Ltd. | Negative | U.S. | U.S. | 275 | |||||||||
Transportation | Aviation Capital Group LLC | Negative | U.S. | U.S. | 4,428 | |||||||||
High technology | Avnet Inc. | Negative | U.S. | U.S. | 1,200 | |||||||||
Transportation | Avolon Holdings Ltd. | Negative | Cayman Islands | U.S. | 10,649 | |||||||||
Financial institutions | Bank of Ireland Group PLC | Negative | Ireland | Europe | 7,041 | |||||||||
Homebuilders/real estate companies | Beijing Capital Group Co. Ltd., | Negative | China | Asia/Pacific | 500 | |||||||||
Chemicals, packaging, and environmental services | Beijing Haidian State-Owned Asset Investment Group Co. Ltd. | Negative | China | Asia/Pacific | 500 | |||||||||
Telecommunications | Bharti Airtel Ltd. | Negative | India | Asia/Pacific | 4,424 | |||||||||
Aerospace and defense | Boeing Co. | Negative | U.S. | U.S. | 50,248 | |||||||||
Financial institutions | BrightSphere Investment Group Inc. | Negative | U.S. | U.S. | 400 | |||||||||
Homebuilders/real estate companies | Brookfield Property REIT Inc. | Negative | U.S. | U.S. | 13,700 | |||||||||
Metals, mining, and steel | Cameco Corp. | Negative | Canada | Canada | 1,094 | |||||||||
Retail/restaurants | Capri Holdings Ltd. | Negative | British Virgin Islands | Europe | 450 | |||||||||
Metals, mining, and steel | Carpenter Technology Corp. | Negative | U.S. | U.S. | 600 | |||||||||
Forest products and building materials | Celulosa Arauco y Constitucion, S.A. (ARAUCO) | Negative | Chile | Latin America | 3,900 | |||||||||
Oil and gas | Cenovus Energy Inc. | Negative | Canada | Canada | 5,824 | |||||||||
Homebuilders/real estate companies | China Jinmao Holdings Group Ltd. | Negative | Hong Kong | Asia/Pacific | 1,741 | |||||||||
Media and entertainment | Choice Hotels International Inc. | Negative | U.S. | U.S. | 1,250 | |||||||||
Homebuilders/real estate companies | Citycon Oyj | Negative | Finland | Europe | 2,384 | |||||||||
Retail/restaurants | Darden Restaurants Inc. | Negative | U.S. | U.S. | 1,250 | |||||||||
Financial institutions | Discover Financial Services | Negative | U.S. | U.S. | 11,939 | |||||||||
Forest products and building materials | Eagle Materials Inc. | Watch Neg | U.S. | U.S. | 350 | |||||||||
Oil and gas | Ecopetrol S.A. | Negative | Colombia | Latin America | 9,350 | |||||||||
Utilities | Eesti Energia AS | Negative | Estonia | Europe | 613 | |||||||||
Utilities | Empresa Nacional del Petroleo | Negative | Chile | Latin America | 2,480 | |||||||||
Merchant power | Enable Midstream Partners, LP | Negative | U.S. | U.S. | 1,850 | |||||||||
Midstream | Energy Transfer LP | Negative | U.S. | U.S. | 47,902 | |||||||||
Media and entertainment | Expedia Group Inc., | Negative | U.S. | U.S. | 7,047 | |||||||||
Financial institutions | FCE Bank PLC | Negative | U.K. | Europe | 7,672 | |||||||||
Financial institutions | Financiera de Desarrollo Territorial S.A. FINDETER | Negative | Colombia | Latin America | 500 | |||||||||
Transportation | FirstGroup PLC | Negative | U.K. | Europe | 1,181 | |||||||||
Capital goods | Flowserve Corp. | Negative | U.S. | U.S. | 1,913 | |||||||||
Capital goods | Fluor Corp. | Negative | U.S. | U.S. | 1,713 | |||||||||
Financial institutions | Golub Capital BDC, Inc | Negative | U.S. | U.S. | 400 | |||||||||
Diversified | Grupo de Inversiones Suramericana S.A. | Negative | Colombia | Latin America | 850 | |||||||||
Oil and gas | Hess Corp | Negative | U.S. | U.S. | 7,600 | |||||||||
Aerospace and defense | Hexcel Corp. | Negative | U.S. | U.S. | 700 | |||||||||
Media and entertainment | Host Hotels & Resorts Inc. | Negative | U.S. | U.S. | 5,200 | |||||||||
Media and entertainment | Hyatt Hotels Corp. | Negative | U.S. | U.S. | 2,950 | |||||||||
Financial institutions | ICICI Bank Ltd. | Negative | India | Asia/Pacific | 2,150 | |||||||||
Consumer products | ISS A/S | Negative | Denmark | Europe | 3,187 | |||||||||
Media and entertainment | ITV PLC | Negative | U.K. | Europe | 2,084 | |||||||||
Utilities | Indigo Group S.A. | Negative | France | Europe | 2,421 | |||||||||
Media and entertainment | Informa PLC | Negative | U.K. | Europe | 2,875 | |||||||||
Midstream | Inter Pipeline Ltd. | Negative | Canada | Canada | 3,886 | |||||||||
Media and entertainment | InterContinental Hotels Group PLC | Negative | U.K. | Europe | 2,875 | |||||||||
Financial institutions | Intercorp Financial Services Inc. | Negative | Peru | Latin America | 600 | |||||||||
Media and entertainment | JCDecaux S.A. | Negative | France | Europe | 2,390 | |||||||||
Sovereign | Kingdom of Morocco | Negative | Morocco | Eastern Europe/Middle East/Africa | 8,927 | |||||||||
Retail/restaurants | Kohl's Corp. | Negative | U.S. | U.S. | 3,200 | |||||||||
Media and entertainment | Las Vegas Sands Corp. | Negative | U.S. | U.S. | 10,300 | |||||||||
Automotive | Lear Corp. | Negative | U.S. | U.S. | 2,300 | |||||||||
Utilities | Madrilena Red de Gas, S.A.U. | Negative | Spain | Europe | 1,165 | |||||||||
Financial institutions | Marex Spectron Group Ltd. | Negative | U.K. | Europe | 6 | |||||||||
Media and entertainment | Marriott International Inc. | Negative | U.S. | U.S. | 10,037 | |||||||||
Retail/restaurants | Metro AG | Negative | Germany | Europe | 2,053 | |||||||||
Capital goods | Metso Outotec Oyj | Negative | Finland | Europe | 858 | |||||||||
Consumer products | Molson Coors Beverage Co. | Negative | U.S. | U.S. | 7,381 | |||||||||
Chemicals, packaging, and environmental services | Mosaic Co. (The) | Negative | U.S. | U.S. | 4,870 | |||||||||
Automotive | Nexteer Automotive Group Ltd. | Negative | Cayman Islands | U.S. | 250 | |||||||||
Automotive | Nissan Motor Co. Ltd. | Negative | Japan | Asia/Pacific | 16,654 | |||||||||
Financial institutions | Nova Ljubljanska Banka D.D. | Negative | Slovenia | Europe | 294 | |||||||||
Chemicals, packaging, and environmental services | OCP S.A. | Negative | Morocco | Eastern Europe/Middle East/Africa | 2,850 | |||||||||
Oil and gas | Ovintiv Inc. | Negative | U.S. | U.S. | 6,450 | |||||||||
Utilities | PT Pelabuhan Indonesia III (Persero) | Negative | Indonesia | Asia/Pacific | 500 | |||||||||
Consumer products | PVH Corp. | Negative | U.S. | U.S. | 3,585 | |||||||||
Automotive | Peugeot S.A. | Negative | France | Europe | 19,306 | |||||||||
Financial institutions | Prospect Capital Corp. | Negative | U.S. | U.S. | 5,678 | |||||||||
Utilities | Puget Energy Inc. | Negative | U.S. | U.S. | 6,278 | |||||||||
High technology | Rakuten Inc., | Negative | Japan | Asia/Pacific | 800 | |||||||||
Sovereign | Republic of Colombia | Negative | Colombia | Latin America | 28,077 | |||||||||
Media and entertainment | Resorts World Las Vegas LLC | Negative | U.S. | U.S. | 1,400 | |||||||||
Homebuilders/real estate companies | Retail Opportunity Investments Corp. | Negative | U.S. | U.S. | 500 | |||||||||
Sovereign | Romania | Negative | Romania | Europe | 44,940 | |||||||||
Oil and gas | SK Innovation Co. Ltd., | Negative | Korea | Asia/Pacific | 500 | |||||||||
Media and entertainment | SKYCITY Entertainment Group Ltd. | Negative | New Zealand | Asia/Pacific | 339 | |||||||||
Transportation | Stagecoach Group PLC | Negative | U.K. | Europe | 540 | |||||||||
Forest products and building materials | Standard Industries Inc. | Negative | U.S. | U.S. | 5,031 | |||||||||
Consumer products | Steelcase Inc. | Negative | U.S. | U.S. | 450 | |||||||||
Consumer products | Suedzucker AG | Negative | Germany | Europe | 1,839 | |||||||||
Forest products and building materials | Suzano S.A. | Negative | Brazil | Latin America | 5,900 | |||||||||
Financial institutions | Synchrony Financial | Negative | U.S. | U.S. | 8,000 | |||||||||
Financial institutions | Synovus Financial Corp. | Negative | U.S. | U.S. | 2,130 | |||||||||
Consumer products | Sysco Corp. | Negative | U.S. | U.S. | 12,088 | |||||||||
Financial institutions | Tanner Servicios Financieros S.A. | Negative | Chile | Latin America | 367 | |||||||||
Consumer products | Tapestry Inc., | Negative | U.S. | U.S. | 1,600 | |||||||||
Capital goods | Timken Co. (The) | Negative | U.S. | U.S. | 850 | |||||||||
Chemicals, packaging, and environmental services | UPL Corp. Ltd. | Negative | Mauritius | Eastern Europe/Middle East/Africa | 1,700 | |||||||||
High technology | VMware Inc. | Negative | U.S. | U.S. | 4,750 | |||||||||
Financial institutions | Virgin Money UK PLC | Negative | U.K. | Europe | 4,938 | |||||||||
Capital goods | Westinghouse Air Brake Technologies Corp. | Negative | U.S. | U.S. | 3,500 | |||||||||
Homebuilders/real estate companies | Yuexiu Real Estate Investment Trust | Negative | Hong Kong | Asia/Pacific | 400 | |||||||||
Automotive | Zhejiang Geely Holding Group Co. Ltd., | Negative | China | Asia/Pacific | 3,945 | |||||||||
Transportation | easyJet PLC | Negative | U.K. | Europe | 1,839 | |||||||||
Data as of Dec. 31, 2020. Potential fallen angels are defined as issuers rated ‘BBB-‘ by S&P Global Ratings with negative outlooks or ratings on CreditWatch with negative implications, and which currently have bonds outstanding. Includes all rated issuers with valid outstanding debt at the time of the rating action. Valid debt includes issuer-level debt (both secured and unsecured), bank loans, subordinated debt, medium-term notes, preferred stock, convertible debt and drawdowns under MTN programs and excludes commercial paper programs, shelf registrations, certificates of deposit, and debt rated on a confidential basis. Source: S&P Global Ratings Research. |
Table 3
Time To Default Among Fallen Angels Is The Shortest In Real Estate, Insurance, and Financial Institutions | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sector | Total fallen angels | Defaults | Average years from fall* | Median years from fall | St. dev. of years from fall | % of fallen angels defaulted | ||||||||
Aerospace/automotive/capital goods/metal | 222 | 53 | 6.9 | 4.2 | 7.3 | 24 | ||||||||
Consumer/service sector | 240 | 57 | 7.1 | 4.0 | 7.0 | 24 | ||||||||
Energy and natural resources | 134 | 21 | 3.6 | 1.5 | 6.1 | 16 | ||||||||
Financial institutions | 418 | 67 | 2.6 | 1.1 | 4.6 | 16 | ||||||||
Forest & building products/homebuilders | 97 | 20 | 7.0 | 7.0 | 5.9 | 21 | ||||||||
Health care/chemicals | 109 | 13 | 5.4 | 5.6 | 4.4 | 12 | ||||||||
High tech/computers/office equipment | 78 | 13 | 5.6 | 3.2 | 5.7 | 17 | ||||||||
Insurance | 204 | 51 | 2.4 | 1.3 | 3.3 | 25 | ||||||||
Leisure time/media | 109 | 20 | 5.1 | 2.7 | 5.0 | 18 | ||||||||
Real estate | 85 | 9 | 2.1 | 1.1 | 2.2 | 11 | ||||||||
Telecommunications | 61 | 12 | 3.2 | 1.2 | 5.0 | 20 | ||||||||
Transportation | 125 | 23 | 10.1 | 9.7 | 8.8 | 18 | ||||||||
Utility | 275 | 37 | 3.1 | 1.0 | 5.1 | 13 | ||||||||
Total | 2157 | 396 | 4.9 | 2.4 | 6.2 | 18 | ||||||||
Data as of Dec. 31, 2020. Sources: S&P Global Ratings Research, and S&P Global Market Intelligence CreditPro. |
Table 4
Rising Stars Saw Their All-Time Low In 2020 | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Date | Issuer | To | From | Sector/subsector | Country | Rated debt affected (mil. US$) | ||||||||
23-Jan-2020 | WellCare Health Plans Inc. | BBB- | BB | Insurance | U.S. | 1,950 | ||||||||
1-Jun-2020 | FGL Holdings | BBB- | BB+ | Insurance | Cayman Islands | 550 | ||||||||
18-Aug-2020 | Sobeys Inc. (Empire Co. Ltd.) | BBB- | BB+ | Retail/restaurants | Canada | 717 | ||||||||
21-Aug-2020 | Mediacom Communications Corp. | BBB | BB+ | Telecommunications | U.S. | 20,700 | ||||||||
17-Sep-2020 | Mobile TeleSystems PJSC (Sistema (PJSFC)) | BBB- | BB+ | Telecommunications | Russia | 1,000 | ||||||||
2-Nov-2020 | AES Corp. (The) | BBB- | BB+ | Utilities | U.S. | 8,206 | ||||||||
18-Nov-2020 | Ericsson (Telefonaktiebolaget L.M.) | BBB- | BB+ | High technology | Sweden | 2,184 | ||||||||
Data as of Dec. 31, 2020. Rising stars are defined as speculative-grade issuers currently with bonds outstanding that have been upgraded into investment-grade (i.e. from 'BB+' and below to 'BBB-' and above). Includes all rated issuers with valid outstanding debt at the time of the rating action. Valid debt includes issuer-level debt (both secured and unsecured), bank loans, subordinated debt, medium-term notes, preferred stock, convertible debt and drawdowns under MTN programs and excludes commercial paper programs, shelf registrations, certificates of deposit, and debt rated on a confidential basis. Source: S&P Global Ratings Research. |
Table 5
Potential Rising Stars Stood At 17 At End-2020 | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Subsector | Issuer | Outlook/Creditwatch change | New to the list this month | Country | Debt amount (mil. US$) | |||||||
High technology | Advanced Micro Devices Inc. | Watch Positive | U.S. | 1,305 | ||||||||
Financial institutions | CIT Group Inc., | Watch Positive | U.S. | 5,651 | ||||||||
Automotive | Fiat Chrysler Automobiles N.V. | Watch Positive | Netherlands | 24,923 | ||||||||
Financial institutions | FleetCor Technologies Inc., | Positive | U.S. | 3,040 | ||||||||
Metals, mining & steel | Gold Fields Ltd. | Positive | South Africa | 1,000 | ||||||||
Capital goods | HD Supply Inc. | Watch Positive | Yes | U.S. | 1,820 | |||||||
Utilities | Hrvatska Elektroprivreda d.d. | Positive | Croatia | 550 | ||||||||
Consumer products | JDE Peet's N.V. | Positive | Netherlands | 5,825 | ||||||||
Homebuilders/real estate companies | Lennar Corp. | Positive | U.S. | 5,400 | ||||||||
Insurance | Magellan Health Inc. | Watch Positive | U.S. | 400 | ||||||||
Homebuilders/real estate companies | MDC Holdings Inc. | Positive | U.S. | 900 | ||||||||
Forest products and building materials | PulteGroup Inc., | Positive | U.S. | 2,997 | ||||||||
Homebuilders/real estate companies | Shimao Group Holdings Ltd. | Positive | Cayman Islands | 2,700 | ||||||||
Forest products and building materials | Smurfit Kappa Group PLC | Positive | Yes | Ireland | 2,091 | |||||||
Transportation | Sovcomflot PAO | Positive | Russia | 750 | ||||||||
Utilities | Vistra Corp. | Positive | U.S. | 10,198 | ||||||||
Metals, mining & steel | Yamana Gold Inc. | Positive | Canada | 1,800 | ||||||||
Data as of Dec. 31, 2020. Potential rising stars are defined as issuers rated ‘BB+‘ by S&P Global Ratings with positive outlooks or ratings on CreditWatch with positive implications, and which currently have bonds outstanding. Includes all rated issuers with valid outstanding debt at the time of the rating action. Valid debt includes issuer-level debt (both secured and unsecured), bank loans, subordinated debt, medium-term notes, preferred stock, convertible debt and drawdowns under MTN programs and excludes commercial paper programs, shelf registrations, certificates of deposit, and debt rated on a confidential basis. Source: S&P Global Ratings Research. |
This report does not constitute a rating action.
Credit Markets Research: | Vincent R Conti, Singapore + 65 6216 1188; vincent.conti@spglobal.com |
Sarah Limbach, Paris + 33 14 420 6708; Sarah.Limbach@spglobal.com | |
Sudeep K Kesh, New York + 1 (212) 438 7982; sudeep.kesh@spglobal.com | |
Research Contributors: | Lyndon Fernandes, Mumbai; lyndon.fernandes@spglobal.com |
Shripati Pranshu, Mumbai; shripati.pranshu@spglobal.com |
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