Moody's upgrades McAfee

Moody's Ratings said it upgraded McAfee Corp.'s corporate family rating to B2 from B3, probability of default rating to B2-PD from B3-PD, the senior secured first-lien bank credit facility to B1 from B2 and the senior unsecured debt rating to Caa1 from Caa2.

“The upgrade reflects McAfee's significant scale, leading position in the consumer security business, and Moody's anticipation for continued growth in revenue and EBITDA, strong cash generating capabilities and improving credit metrics. Debt to EBITDA (before non-cash stock-related compensation and certain other adjustments) is just below 8x as of December 2023 and should trend towards 7x over the next 12-18 months in the absence of debt-financed acquisitions or distributions.

Free cash flow to debt was slightly below 6% for the same period and should grow to over 6% over the next 12-18 months. McAfee's extensive hedging program has limited the impact of rising interest rates on cash flow,” Moody’s said in a press release.

The outlook is stable.

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