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Industry Report Card: Moderate Growth, Negative Ratings Trends In Global High Technology Expected To Continue In 2007 Dec 06
Standard & Poors, Dec 2006
Abstract
Despite a relatively stable operating environment, credit trends in the global high technology sector have shifted from fairly balanced, but slightly positive, during 2005 to clearly negative for 2006. Both trends are expected to continue in 2007: Standard & Poor's Ratings Services expects similar mid-single-digit information technology (IT) growth, coupled with an ongoing negative rating trend. Technology companies increasingly are willing to take on debt, most dramatically evidenced by the $17 billion LBO of Freescale Semiconductor Inc. Our corporate credit rating on the company was lowered out of investment grade to 'BB-', which still makes it one of the stronger LBOs. Somewhat less dramatically, ratings were lowered on both Computer Sciences Corp. and Affiliated Computer Services Inc., because of large...
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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