Moody’s upgrades Generac CFR, loan to Ba3

Moody's Investors Service said it upgraded Generac Power Systems, Inc.'s corporate family rating to Ba3 from B1 and probability of default rating to Ba3-PD from B1-PD.

The agency also upgraded the rating on Generac's $1.2 billion term loan B facility to Ba3 from B1. The speculative grade liquidity rating was affirmed at SGL-2.

The outlook is stable, reflecting Moody's expectation that the generating equipment manufacturer will continue to perform well, with strong metrics for the rating level balanced against the company's product concentration and cyclicality.

Moody’s said the Ba3 corporate family rating recognizes Generac's low leverage, strong brand recognition, well established market position, competitive margins and track record of good cash flow generation. The ratings and outlook are also supported by Generac's SGL-2 liquidity profile and expectation that positive free cash flow generation should support further deleveraging.

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