S&P revises FirstCash outlook to stable

S&P said it revised the outlook for FirstCash Holdings Inc. to stable from negative and affirmed the BB ratings on the company and its senior unsecured notes. The debt recovery rating remains 3, reflecting meaningful recovery (50%) in a default scenario.

“The outlook revision stems from FirstCash's stronger-than-expected performance in 2022 and our expectation that the company will continue to delever over the next 12 months. FirstCash ended 2022 with leverage of 3.2x. Following strong first-quarter earnings, leverage declined to 2.9x. Over the next 12 months, we expect debt to EBITDA of 2x-3x and EBITDA interest coverage of 6x-8x. Our forecast doesn't assume any meaningful changes to the outstanding debt balance through either paydowns or additional debt,” S&P said in a statement.

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