Research Update: Carrier Global Corp. Outlook Revised To Negative On Weakened Demand, Delayed Leverage Reduction; 'BBB' Ratings Affirmed

Palm Beach Gardens, Fla.-based Carrier Global Corp. separated from United Technologies Corp. (since renamed Raytheon Technologies Corp) on April 3, 2020, with adjusted leverage of 3.6x. The economic recession wrought by the coronavirus pandemic will likely result in Carrier experiencing a 12%-17% decline in 2020 sales. As a result, we anticipate Carrier's normally robust earnings power will be curtailed over the next two years and debt-to-EBITDA leverage to increase and remain above 4x through 2021. We are revising our outlook on Carrier to negative from stable and affirming the 'BBB' issuer and issue-level ratings. The negative outlook reflects the elimination of cushion in leverage metrics for the rating and potential for a downgrade over the next two years if prolonged

...- Palm Beach Gardens, Fla.-based Carrier Global Corp. separated from United Technologies Corp. (since renamed Raytheon Technologies Corp) on April 3, 2020, with adjusted leverage of 3.6x. - The economic recession wrought by the coronavirus pandemic will likely result in Carrier experiencing a 12%-17% decline in 2020 sales. - As a result, we anticipate Carrier's normally robust earnings power will be curtailed over the next two years and debt-to-EBITDA leverage to increase and remain above 4x through 2021. - We are revising our outlook on Carrier to negative from stable and affirming the '###' issuer and issue-level ratings. - The negative outlook reflects the elimination of cushion in leverage metrics for the rating and potential for a downgrade over the next two years if prolonged adverse industry conditions result in credit measures sustained above 4x....

Research Update