S&P Global Ratings took 17 rating actions and maintained 64 ratings in the U.S. not-for-profit higher education sector during the fourth quarter of 2024. The 17 rating actions are broken out as follows:
The four upgrades were spurred by increased and sustained financial resources and enrollment, stronger operating performance, and improved state credit quality and support. The one positive outlook revision reflects a trend of operating surpluses with consistent growth in financial resources and improved demand metrics. The two outlook revisions to stable from negative were a result of stabilized enrollment and management teams' efforts to address operating issues, including balancing the operating budget and implementing stricter financial controls.
The four downgrades and six negative outlook revisions were, inversely, spurred by continued enrollment declines resulting in pressured operating performance, deteriorating financial resources, elevated endowment draws, and weakened demand metrics due to headline risk.
As discussed in our 2025 sector outlook and fiscal 2023 medians reports, credit quality has widened, consistent with our bifurcated outlook. Higher-rated institutions with strong demand and reputations, excellent fundraising, and sound resources have maintained or strengthened their market positions, while lower-rated institutions, such as those that are regional or less selective and lacking financial flexibility, continue to face heightened difficulties, including increased competition, strained operations, and liquidity and bond covenant pressures.
Due to demographic trends and delays with the Free Application for Federal Student Aid (FAFSA), fall 2024 enrollment was difficult for many of these schools, which faced enrollment declines pre-pandemic. In addition, falling net tuition revenue and increased costs are contributing to pressured operating performance. There are also uncertainties on how the new federal administration could affect institutions in coming years.
The following tables summarize S&P Global Ratings' quarterly rating actions for U.S. not-for-profit higher education issuers. The rating actions, outlooks, and maintained ratings are based on our "Global Not-For-Profit Education Providers" criteria, published April 24, 2023.
Table 1
Fourth-quarter 2024 U.S. higher education rating actions | ||||||
---|---|---|---|---|---|---|
Institution | State | Rating to | Rating from | Outlook to | Outlook from | Description |
Kettering University | MI | BBB+ | A- | Stable | Negative | Continued enrollment declines with a high level of student dependence, resulting in operating deficits |
Manhattan University | NY | BBB | BBB+ | Negative | Stable | Sustained enrollment declines and weakening of credit characteristics, leading to operating pressures and increased endowment draws |
Midwestern University | IL | AA- | A+ | Stable | Positive | Consistent, significant operating surpluses and increasing financial resources over time |
Neumann University | PA | BBB- | BBB | Stable | Negative | Very weak financial resources and trend of operating deficits, which are expected to continue |
Simmons University | MA | BB+ | BBB- | Negative | Negative | Continued enrollment declines creating operating pressure and anticipated heavy endowment draw, which could strain financial resources |
Southern Illinois University | IL | A- | BBB+ | Stable | Stable | Stabilizing enrollment trend, increasing cash and investments, and improved state credit quality and support |
St. John's College | MD | A- | BBB+ | Stable | Positive | Sustained financial resource growth, leading to less reliance on student-generated revenue for operations |
Virginia Polytechnic Institute & State University | VA | AA+ | AA | Stable | Stable | Improved enrollment, selectivity, operating results, and financial resources to levels consistent with higher-rated peers |
Table 2
Fourth-quarter 2024 U.S. higher education outlook revisions | |||||
---|---|---|---|---|---|
Institution | State | Rating | Outlook to | Outlook from | Description |
American University | DC | A+ | Negative | Stable | Recent enrollment and demand challenges, which could continue over the outlook period |
Cleveland Institute of Music | OH | BBB- | Negative | Stable | Declining enrollment and weakening demand metrics from headline risk, which could weaken operations and financial resources |
Doane University | NE | A- | Negative | Stable | Weak enrollment trend and pressured operations, resulting in elevated endowment draws |
Hampden-Sydney College | VA | A | Negative | Stable | Significant operating deficits, additional endowment draws, very high tuition discount rate, and weaker unrestricted financial resources |
Hendrix College | AR | BBB- | Stable | Negative | Recent enrollment stabilization, solid balance-sheet metrics, and management's plan to balance the operating budget |
Rosalind Franklin University of Medicine & Science | IL | BBB+ | Negative | Stable | Weakened operating results and a decline in financial resource ratios over the last few years |
State University of Iowa | IA | AA | Positive | Stable | Multiple years of large surpluses, consistent growth in financial resources, and improving demand metrics |
University of Hartford | CT | BB+ | Stable | Negative | Stabilized enrollment and strengthened financial controls, resulting in slimmer operating deficits |
University of Portland | OR | A | Negative | Stable | Consistent enrollment declines, resulting in growing operating deficits and weakening financial resources in the last three years |
Table 3
Fourth-quarter 2024 U.S. higher education maintained ratings | |||
---|---|---|---|
Institution | State | Rating | Outlook |
Allegheny College | PA | A- | Stable |
Barton College | NC | BB+ | Stable |
Belmont University | TN | A | Stable |
Berklee College of Music | MA | A | Stable |
Boise State University | ID | A+ | Stable |
Boston University | MA | AA- | Positive |
Brown University | RI | AA+ | Stable |
California Institute of Technology | CA | AA- | Stable |
Case Western Reserve University | OH | AA- | Stable |
College of the Holy Cross | MA | AA- | Stable |
College of William & Mary | VA | AA | Stable |
Denison University | OH | AA | Stable |
Dickinson College | PA | A+ | Stable |
Drexel University | PA | BBB+ | Stable |
Duke University | NC | AA+ | Stable |
Emerson College | MA | BBB+ | Stable |
Gettysburg College | PA | A | Stable |
Haverford College | PA | AA- | Stable |
Holy Family University | PA | A- | Stable |
Houston Christian University | TX | BBB- | Stable |
Knox College | IL | BBB+ | Stable |
Lafayette College | PA | A+ | Stable |
Lake Forest College | IL | BBB | Stable |
Marian University | IN | BBB | Stable |
Marshall B. Ketchum University | CA | A- | Stable |
Massachusetts Institute of Technology | MA | AAA | Stable |
Mercyhurst University | PA | BB | Negative |
North Dakota State University | ND | AA- | Stable |
Olin College of Engineering | MA | A | Stable |
Purdue University | IN | AAA | Stable |
Ramapo College | NJ | A | Stable |
Randolph College | VA | BBB+ | Stable |
Reed College | OR | AA- | Stable |
Rivier University | NH | BBB | Stable |
Rose-Hulman Institute of Technology | IN | A- | Stable |
Southeastern University | FL | BB | Stable |
Temple University | PA | A+ | Stable |
The College of Idaho | ID | BBB | Stable |
The Juilliard School | NY | AA | Stable |
The New School | NY | BBB+ | Stable |
Universidad del Sagrado Corazon | PR | BB | Stable |
University of Central Missouri | MO | A+ | Stable |
University of Denver | CO | A+ | Stable |
University of Detroit Mercy | MI | BBB | Stable |
University of Evansville | IN | BBB- | Stable |
University of Illinois | IL | AA- | Positive |
University of Miami | FL | A- | Stable |
University of New Haven | CT | BBB- | Stable |
University of New Mexico | NM | AA- | Stable |
University of Pennsylvania | PA | AA+ | Stable |
University of Puget Sound | WA | A+ | Stable |
University of Rhode Island | RI | A+ | Stable |
University of St. Thomas | TX | BBB | Stable |
University of Texas System | TX | AAA | Stable |
University of Virginia | VA | AAA | Stable |
University System of New Hampshire | NH | A+ | Stable |
Ursinus College | PA | BBB | Stable |
Washington & Lee University | VA | AA | Stable |
Washington University | MO | AA+ | Stable |
Wellesley College | MA | AA+ | Stable |
West Virginia University | WV | A | Stable |
Wingate University | NC | BBB- | Stable |
Worcester Polytechnic Institute | MA | A | Stable |
York College of Pennsylvania | PA | A- | Stable |
Related Research
- U.S. States 2025 Outlook: Eyes On Washington, Focus On Budgets, Jan. 7, 2025
- U.S. Not-For-Profit Higher Education Outlook 2025: The Credit Quality Divide Widens, Dec. 5, 2024
- U.S. Not-For-Profit Acute Health Care 2025 Outlook: Stable But Shaky For Many Amid Uneven Recovery And Regulatory Challenges, Dec. 4, 2024
- Economic Outlook U.S. Q1 2025: Steady Growth, Significant Policy Uncertainty, Nov. 26, 2024
- U.S. Higher Education Rating Actions, Third-Quarter 2024, Oct. 11, 2024
- The New "New Normal": Trends In U.S. Higher Education Post-Pandemic Versus Post-Recession, Sept. 25, 2024
- U.S. Higher Education Rating Actions, Second-Quarter 2024, July 19, 2024
- U.S. State Funding: Propping Up Public Universities In An Increasingly Competitive Landscape, July 18, 2024
- U.S. Not-For-Profit Public College And University Fiscal 2023 Medians: Rising State Funding Offers Hope Amid Continued Demand Pressures, July 18, 2024
- U.S. Not-For-Profit Private College And University Fiscal 2023 Medians: Inflated Expenses, Deflated Support Contribute To Weaker Margins, July 18, 2024
- Rising Covenant Violations Are A Symptom Of The Pressure Facing Lower-Rated U.S. Higher Education Entities, June 20, 2024
- U.S. Higher Education Rating Actions, First-Quarter 2024, April 18, 2024
Cheyenne Barber and Sid Kolli contributed research for this report.
This report does not constitute a rating action.
Primary Credit Analyst: | Stefan Turcic, New York (1) 212-438-0559; stefan.turcic@spglobal.com |
Secondary Contacts: | Jessica L Wood, Chicago + 1 (312) 233 7004; jessica.wood@spglobal.com |
Laura A Kuffler-Macdonald, New York + 1 (212) 438 2519; laura.kuffler.macdonald@spglobal.com |
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