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Industry Report Card: Global High Technology Ratings Trend Turns Negative On Consolidation In Telecom Equipment, Software Jul 06
Standard & Poors, July 2006
Abstract
Despite a relatively stable operating environment, credit trends have shifted from slightly positive, during 2005 to clearly negative for the year to date. This negative trend will likely continue during the balance of the year, given the current outlook distribution, which includes 14 credits on CreditWatch with negative implications, compared with only two on CreditWatch with positive implications. Much of the rating activity reflects discretionary decisions regarding acquisitions, share repurchases and dividend recaps. Standard & Poor's Ratings Services continues to expect growth in IT spending in 2006 to be moderate overall, with growth estimated in the mid-single digits, similar to 2005 levels. Technology shifts, like the early transition from circuit based telephony to voice over Internet protocol (VoIP) and from...
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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