S&P Upgrades Equinix (EQIX) to 'BB+'; Outlook is Stable
- Wall Street surges to new highs; transports set record
- lululemon athletica (LULU) Tops Q3 EPS by 4c; Adj.-Comps Outpaced Views
- Abbott (ABT) Files Complaint to Terminate Alere (ALR) Acquisition
- Costco Wholesale (COST) Tops Q1 EPS by 5c; Comps Up 1%, 2% Ex-Gas
- After-Hours Stock Movers 12/07: (VYGR) (LULU) (HRB( Higher; (OHRP) (VRNT) (CMTL) Lower (more...)
Get inside Wall Street with StreetInsider Premium. Claim your 2-week free trial here.
S&P Global Ratings said it raised its corporate credit rating on Equinix Inc. (Nasdaq: EQIX) to 'BB+' from 'BB' and removed all ratings from CreditWatch, where we had placed them with positive implications on July 25, 2016. The outlook is stable.
At the same time, we raised our issue-level ratings on the company's secured debt to 'BBB' from 'BBB-'. The recovery rating remains '1', indicating our expectation for substantial recovery (90%-100%) in a payment default scenario. We also raised our issue-level ratings on the company's unsecured debt to 'BB+' from 'BB'. The recovery rating remains '3', indicating our expectation for meaningful (30%-50%; upper end of the range) recovery in the event of a payment default.
"The upgrade reflects our belief that Equinix's network and cloud-dense environment positions the company well to take advantage of rising demand for data centers driven by increased IT outsourcing by enterprises, data growth, and increased application complexity," said S&P Global Ratings credit analyst Chris Mooney.
Equinix has steadily expanded over the years, both organically and through acquisitions, more than doubling its revenue base since 2011. The company now operates 146 data centers in 40 markets across North America, Europe, and Asia making it the largest retail colocation provider globally with a 14% share of the growing market. We believe Equinix's significant scale enhances the value of its overall ecosystem, allowing customers to interconnect to other enterprise, network and cloud customers--which we believe will become more prevalent in the future as businesses, networks, machines, and data become increasingly more connected--while its global footprint attracts multinational customers. As a result, we anticipate that Equinix will outpace overall retail colocation market growth of 8%-10% over the next several years.
The outlook is stable. We expect adjusted net debt to EBITDA to improve modestly to the low-4x area over the next year as earnings growth is partly offset by lower cash balances and possibly revolver borrowings to fund capital investments, acquisitions, and dividend distributions.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Tailored Brands (TLRD) Tops Q3 EPS by 13c
- Wedbush Raises Price Target on Francesca's (FRAN) Following 3Q Report
- Equinix (EQIX) volatility flat into acquiring 24 data center sites from Verizon
Create E-mail Alert Related CategoriesCredit Ratings
Related EntitiesStandard & Poor's, Earnings
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!