Moody’s views Power Stop positively

Moody’s Investors Service said it revised its outlook for Power Stop, LLC to positive from stable and affirmed its Caa1 ratings on the company and its senior secured first lien bank credit facilities.

“The ratings affirmation and outlook change to positive reflect Power Stop's improving operating performance and liquidity. Following a challenging 2022, Power Stop has successfully increased revenues through volume growth of its brake kits while earnings have benefitted from lower freight costs. Further, the company has effectively managed through previously elevated inventory levels to generate free cash flow and materially improve liquidity,” the agency said in a press release.

Moody’s said it expects Power Stop to maintain an EBITA margin that approaches its historical level of close to 20% and keep debt/EBITDA comfortably below 7x.

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