S&P revises Winnebago outlook

S&P said it revised the outlook on Winnebago Industries Inc. to stable from positive and affirmed all ratings on the company, including the BB- corporate credit rating.

The agency said the revision reflects a belief that ratings upside is unlikely given Winnebago's current leverage policy.

“The policy, which includes the company's tolerance for temporary spikes up to 3x for potential mergers and acquisitions, will not likely translate into our measure of adjusted leverage staying below our 3x upgrade threshold over the highly volatile RV economic cycle,” S&P said in a news release.

The agency said the stable outlook reflects an expectation for good operating performance in Winnebago's towables segment that will allow the company to continue to reduce leverage through 2018, and an expectation that Winnebago will have a significant cushion compared to the 4x adjusted debt to EBITDA downgrade threshold.

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