Boeing Co. (BA) long-term credit rating was downgraded two notches at Fitch Ratings, which cited the "rapid escalation" of the coronavirus pandemic and the effect its having on the aerospace giant's markets and operations. The rating but remained in investment grade territory, two notches above "junk" status. Fitch lowered the rating to BBB from A-. The outlook for the rating is negative, given the risks of a more extended coronavirus pandemic, ongoing risks related to the timing of the return to service of the currently grounded 737 MAX planes and the expected pace of the 737 MAX delivery ramp once the grounding is lifted. Fitch said Boeing's debt had doubled in 2019 to around $27 billion, and will continue to rise in 2020, potentially peaking at abour $45 billion. In the case of a prolonged COVID-19 impact, or material delays on the 737 MAX's return of service, Fitch expects Boeing to need access to additional capital, which could further pressure the company's credit profile. The stock soared 16.7% in afternoon trading, but has still lost 61.2% over the past month, to be the worst performer among Dow Jones Industrial Average components over that time. The Dow has lost 26.6% the past month.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
March 24, 2020 15:42 ET (19:42 GMT)
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