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Industry Report Card: U.S. Metals & Mining Positive Ratings Momentum To Feel Pinch Of Competitive, Volatile Markets Apr 06
Standard & Poors, April 2006
Abstract
Rating trends in the metals and mining sector have continued their positive momentum, benefiting from the persistent strength in most segments and company actions to reduce their financial burdens. The pace of upgrades will diminish, however, as many ratings are now constrained by the companies' business risk profiles, reflecting highly competitive and volatile markets. In addition, the entire universe of companies has been experiencing operating cost inflation stemming from higher energy costs, higher currencies relative to the U.S. dollar, and scarcity of materials and labor. Supply and demand growth from developing regions, especially China, is expected to continue to result in market imbalances, price fluctuations, increased competition for raw materials, and large swings in profitability and cash flows. The high...
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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