Credit rating company Standard and Poor (S&P) revised aviation giant Boeing’s rating to negative from stable. The outlook for the recovery in global air travel and therefore aircraft demand continues to weaken. This situation lowers Boeing earnings and cash flow.
S&P states that the company has sufficient liquidity to cover large cash outflows over the next 6-12 months and free cash flow is likely to turn positive in 2021. Therefore, S&P affirms its ratings, including the 'BBB-' long-term and 'A-3' short-term issuer credit ratings, on the aerospace and defence company, but revises the outlook to negative from stable.
The negative outlook reflects that the impact of the coronavirus pandemic on aircraft demand could be materially worse or take longer to recover than we expect, delaying an improvement in earnings and cash flow