Bitcoin price today: falls to 2-week low below $113k ahead of Fed Jackson Hole
Investing.com -- Moody’s Ratings has affirmed Sensata Technologies B.V.’s Ba2 corporate family rating while changing the outlook from positive to stable, according to a rating action released Monday.
The ratings agency maintained Sensata’s Ba2-PD probability of default rating and Ba2 senior unsecured notes ratings. Moody’s also affirmed the ratings of Sensata Technologies, Inc., including its Baa2 senior secured bank credit facility rating and Ba2 backed senior unsecured notes ratings.
The change to a stable outlook reflects Moody’s expectation that weak demand in Sensata’s core automotive and heavy vehicle off-road (HVOR) markets will limit revenue and earnings growth in 2025. The company’s high debt load is expected to keep debt-to-EBITDA elevated throughout 2025.
Moody’s anticipates Sensata’s earnings will improve in 2026 as increased revenue combines with strong cost control measures to generate solid free cash flow and reduce debt leverage.
The Ba2 rating reflects Sensata’s good scale in the specialized sensors and controls market, with products that are deeply integrated into customer offerings. The company is securing new business with differentiated products in key growth areas.
Moody’s expects Sensata’s EBITA margin to improve to approximately 15.5% over the next 12-18 months, driven by the exit from less profitable businesses, better productivity, and strong cost controls. The company is projected to generate over $300 million in annual free cash flow during this period.
The rating agency noted Sensata’s exposure to cyclical markets, particularly automotive, and its history of acquisition-driven leverage. The company’s debt-to-EBITDA ratio stood at 4.6x as of March 31, 2025, though Moody’s expects this to decline to 4.25x over the next 12-18 months as earnings improve.
Revenue is projected to decline by 7.5% in 2025, partly due to the company’s exit from low-profitability businesses in 2024 and the first quarter of 2025. Organic revenue is expected to fall about 2% in 2025 due to soft demand in core markets, before growing 3.0% in 2026.
Sensata maintains very good liquidity, supported by expected free cash flow exceeding $300 million over the next 12 months and nearly full availability of its $750 million revolving credit facility.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.