Valeo: Moody's upgrades outlook from negative to stable

(CercleFinance.com) - Moody's Investors Service announced on Monday that it has raised its outlook on Valeo's credit rating from "negative" to "stable", having confirmed its credit rating at "Baa3".


The rating agency said it took note of the improvement in the financial parameters of the automotive supplier following the coronavirus crisis, particularly regarding its profitability, cash generation and debt reduction.

In its statement, Moody's said it expects the global automotive market to grow by 7% in 2021, before growth slows to +6.1% in 2022, a deceleration that it expects will be confirmed thereafter.

Moody's warned that future vehicle demand may prove to be weaker than its estimates and that the already competitive environment in the automotive sector could intensify further, with stronger-than-expected headwinds for Valeo.

It has however confirmed its short-term rating at Prime-3 (P-3).


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