S&P boosts BJ Wholesale

S&P said it raised BJ's Wholesale Club Holdings Inc.’s issuer rating to BB+ from BB and its term loan to BBB- from BB+.

“The upgrade reflects our expectation for better credit metrics over the next 12 months led by revenue growth and relatively consistent profitability. Performance metrics have remained strong this year and have tracked ahead of our expectations. For the first half of 2022, revenue increased more than 19% on growth in comparable sales, store openings, and the recent acquisition of certain operations of Burris Logistics. Revenue growth this year follows an 8% increase last year and 17% growth in 2020,” S&P said in a press release.

The agency said it estimates the company will deliver S&P adjusted EBITDA margins in the high-6% to low-7% range, as compared to a low- to mid-6% range before 2020.

The outlook is stable.

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