20170626-穆迪服务-CreditOutlook_35页_1mb

CreditOutlook Summary

Core Content

This document provides a summary of credit implications of various current events across different sectors in the US and globally. It covers healthcare reform, corporate acquisitions, infrastructure policies, banking regulations, insurance developments, real estate investment trusts (REITs), pharmaceutical and medical device manufacturers, and market activities related to logistics and aviation.

Main Points

US Healthcare Reform

• Senate's Proposed Healthcare Act: Likely to be credit negative for most affected sectors.
  • Health Insurers: Mixed impact; individual market insurers benefit from a more profitable risk pool, while Medicaid insurers face credit negatives due to reduced federal funding.
  • Hospitals and Healthcare Providers: Credit negative due to reduced insurance coverage and Medicaid funding, leading to lower demand and higher uncompensated care costs.
  • Pharmaceutical and Medical Device Manufacturers: Short-term benefits from tax changes, but long-term credit negatives due to reduced demand and Medicaid funding cuts.

Corporates

• PerkinElmer's Acquisition of EUROIMMUN: Credit negative due to increased leverage and integration risks.
• UPS Surcharges on Holiday Deliveries: Credit positive as it helps manage peak season costs and improve margins.
• Toshiba's Preferred Bidder for Memory Unit: Credit negative for Western Digital due to potential loss of joint venture control and competitive disadvantage.
• Embraer's Aircraft Order Backlog Expansion: Credit positive, reflecting strong market performance and future production growth.
• Diageo's Acquisition of Casamigos: Credit positive due to expansion in the super-premium tequila segment and potential for growth.

Infrastructure

• UK Government's Energy Price Interventions: Credit negative for energy suppliers due to reduced pricing flexibility and potential revenue declines.

Banks

• Banorte's Additional Tier 1 Issuance: Credit positive.
• Russia's New Legal Framework for Syndicated Lending: Credit positive.
• Uzbekistan's Bank Recapitalization: Credit positive.

Insurers

• China's Credit and Guarantee Insurance Regulations: Credit positive for insurers due to clearer regulatory frameworks.

Asset Managers

• BlackRock's Investment in Scalable Capital: Promotes leadership in investment technology, credit positive.

US Public Finance

• Florida Budget for Charter Schools: Credit negative for school districts due to sharing of capital revenues.

Securitization

• Denmark's Housing Loan Limits: Credit positive for covered bonds due to reduced risk exposure.

Key Information

Credit Outlook for Sectors

• Healthcare Sectors: Overall credit negative, with some positives for non-expansion states and certain insurers.
• Corporate Acquisitions: Mixed outcomes, with PerkinElmer's acquisition being negative and Diageo's acquisition being positive.
• Logistics and Aviation: UPS surcharges are positive, while Embraer's credit quality is constrained by the cyclical and competitive nature of the industry.
• Regulatory Changes: Impact varies, with some policies being credit positive (e.g., Russia and Uzbekistan) and others credit negative (e.g., UK energy price interventions).

Financial Metrics

• PerkinElmer: Debt/EBITDA will rise to 4.1x but is expected to decrease to 3.0x within 12-18 months.
• Western Digital: Adjusted debt/EBITDA leverage is expected to fall to 3.0x by year-end 2017 if it does not acquire Toshiba's stake.
• Embraer: Financial leverage is expected to improve from 5.9x to around 3.5x by the end of 2019.
• Diageo: Debt/EBITDA may deteriorate by 0.1x-0.2x, but the company aims to reduce it to below 3.0x.

Sector-by-Sector Analysis

Health Insurers

• Benefit from improved risk pools for younger, healthier individuals.
• Face credit negatives due to the repeal of the individual mandate and reduced Medicaid funding.

States

• Credit negative due to potential cuts in Medicaid funding and reduced federal support.
• States may have to adjust eligibility or reduce payments to providers.

Hospitals and Healthcare Providers

• Credit negative due to reduced insurance coverage and Medicaid funding.
• Some positives for non-expansion states with increased DSH funding.

REITs

• Credit negative for REITs owning nursing facilities due to lower Medicaid reimbursements.

Pharmaceutical Manufacturers

• Credit positive in the short term from tax benefits but credit negative in the long term due to reduced demand and Medicaid cuts.

Medical Device Manufacturers

• Credit positive from tax changes but credit negative due to lower demand and pricing pressure.

UPS

• Credit positive from surcharges on holiday deliveries, which help offset peak season costs.

Embraer

• Credit positive due to expanded aircraft order backlog and strong market position.
• Financial leverage is expected to decrease over time.

Diageo

• Credit positive from acquisition of Casamigos, which supports growth in the super-premium tequila segment.

Conclusion

The document outlines a range of credit implications based on recent developments in various sectors. While some events are credit positive, such as UPS surcharges and Diageo's acquisition, many are credit negative, particularly in the healthcare and infrastructure sectors. The impact varies depending on the sector, the nature of the event, and the company's financial structure and market position.