...Stable Outlook: Market conditions support stable operating profiles for most rated North American chemicals issuers for the period. The chemicals space can be segmented into diversified, commodity, specialty and agriculture-related producers. While each segment has its own dynamics and end-market exposure, most of these segments should benefit from solid domestic demand in manufacturing and recovery in U.S. construction and consumption, as well as low-cost North American energy feedstocks. Strong Liquidity: Most investment-grade rated North American issuers have solid financial profiles and robust liquidity. High-yield issuers' cash flows are more dedicated to debt service as a result of leveraging acquisitions or aggressive growth spending. High-margin chemicals designed to add value to processes or products tend to be less cyclical and support a more leveraged balance sheet. Large, low cost commodity chemical producers can also support high-yield capital structures. Trade Headwinds: More...
