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S&P lowers Kohl's
Standard & Poor's said it lowered the corporate credit and senior unsecured ratings on Kohl's Corp. to BBB+ from A- after the company's board authorized a $2.5 billion three-year share buyback program.
The outlook is stable.
According to S&P, the downgrade reflects the expected decline in cash flow protection measures because of the partly debt-financed share repurchases as well as Kohl's more aggressive financial profile.
The ratings are based on the company's solid position as a family-oriented specialty department store, along with its profitability, cash flow protection and geographic diversity, the agency said.
S&P said Kohl's is moderately leveraged, with total debt-to-EBITDA ratio of 1.9 times for the 12 months ended Aug. 4. The agency said leverage will likely increase over the next few years.
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