Research Update: Southwest Gas Holdings Inc. And Subsidary Outlooks Revised To Stable From Negative; Ratings Affirmed

On Sept. 23, 2020, Southwest Gas Corp. (SWG) received a rate case decision in Nevada that we expect will support of the company's overall credit quality. In addition, our assessment of the company's financial plan indicates that parent Southwest Gas Holdings Inc. (SWX) can maintain its funds from operations (FFO)-to-debt ratio within the 19%-20% range, while maintaining a manageable growth profile of its higher-risk construction services business over the next two years. We are affirming our ratings on SWX, including the 'BBB+' issuer credit rating, and our ratings on subsidiary SWG, including the 'A-' issuer credit rating. At the same time, we are affirming our 'A-' issue-level ratings on SWG's senior unsecured notes. We are also revising the outlook on

...- On Sept. 23, 2020, Southwest Gas Corp. (SWG) received a rate case decision in Nevada that we expect will support of the company's overall credit quality. - In addition, our assessment of the company's financial plan indicates that parent Southwest Gas Holdings Inc. (SWX) can maintain its funds from operations (FFO)-to-debt ratio within the 19%-20% range, while maintaining a manageable growth profile of its higher-risk construction services business over the next two years. - We are affirming our ratings on SWX, including the '###+' issuer credit rating, and our ratings on subsidiary SWG, including the 'A-' issuer credit rating. At the same time, we are affirming our 'A-' issue-level ratings on SWG's senior unsecured notes. We are also revising the outlook on both entities to stable from negative. - The stable outlooks on SWX and SWG reflect our expectations that SWX's construction services business will represent no more than 30% of consolidated EBITDA and that its consolidated FFO-to-debt...

Research Update