Building Products: Ratings Navigator Companion

...Rating Range: Building Products companies have a higher-than-average risk profile. The building products sector's risk profile reflects the cyclicality and seasonality of demand for building products, economic sensitivity, and volatility of raw material and energy costs. Issuers with investment grade ratings typically serve various construction end-markets, with heavier exposure to the relatively less cyclical repair and remodel segment, resulting in more stable revenue and earnings stream. These higher-rated issuers are also market leaders with expansive product and service offerings as well as well-recognized brand names. Investment grade issuers usually exhibit some variability in credit metrics through the cycle, although strong credit protection measures provide flexibility to adjust to downturns. Conversely, issuers with lower ratings usually have somewhat limited product or end-market diversity or have greater exposure to the new construction market, causing more volatile financial...

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