Bangkok--25 Feb--Standard & Poor's
As the economic recession rages on, Standard & Poor's is taking a look at sector vulnerabilities emerging from the slowdown.
In an article published February 23, 2009, titled "Comparative Credit Metrics Of 16 U.S. Industries," we evaluate relative risk across sectors based on factors such as spread changes, cash flow resilience, refinancing exposure, rating volatility, rating mix, and negative bias to identify sectors where there is the most risk.
"Based on our analysis, three sectors—automotive, forest products and building materials, and media and entertainment—stand out as vulnerable based on many of the metrics laid out in this analysis," said Diane Vazza, head of Standard & Poor's Global Fixed Income Research Group. "Homebuilders/real estate is a close second. Its failure to register as being at risk based on cash flow protection measures is a result of data limitations."
Next at risk are chemicals, packaging, and environmental services and retail/restaurants, which appear as vulnerable based on the majority of metrics. Transportation also appears to have higher-than-average risk in terms of cash flow protection, refinancing, and ratings volatility. Although consumer products in the aggregate appears better than average, the consumer discretionary subsector exhibits similar vulnerabilities as the aforementioned higher-risk sectors.
"Other sectors appear less vulnerable based on our key risk metrics, though we expect that no sector will go completely unscathed by the global economic slowdown," said Ms. Vazza.
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Media Contact:
Mimi Barker, New York (1) 212-438-5054, [email protected]
Analyst Contact:
Diane Vazza, New York (1) 212-438-2760
Key Contacts:
Americas Media Relations: (1) 212-438-6667
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Americas Customer Service: (1) 212-438-7280
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