Two positive votes on logistics at Moody’s: GXO and C.H. Robinson

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But the significance is not just that GXO is one notch higher. It is that Baa3 is the first notch above the Moody’s cutoff between investment grade and non-investment grade debt which means that in the eyes of Moody’s, GXO is no longer a junk credit.The second step occurred Monday. It isn’t a change. But the agency affirmed the debt rating of C.H. Robinson (NASDAQ: CHRW) at Baa2, two notches above the cutoff line between investment and non-investment grade debt. Moody’s cited the giant 3PL’s “disciplined approach to managing its balance sheet and financial leverage.”The agency also said it believes Robinson’s “strong market position in the U.S. freight brokerage market will continue to drive solid and consistent results despite a difficult operating environment, including flat volumes and weak pricing dynamics.”The increase in GXO’s rating put the contract logistics provider at a level considered equivalent to the BBB- rating that S&P Global Ratings (NYSE: SPGI) has had on GXO for several years.However, S&P Global Ratings reduced its outlook on GXO to negative in March 2024 when the company acquired Wincanton last year, a U.K.-based contract logistics provider in that country. The negative outlook remains, which is often a first step toward a downgrade.By contrast, the new Moody’s rating for GXO comes with a stable outlook. The outlook had been positive, which is often a precursor to an increase in a company’s debt rating.GXO is a publicly traded company so its finances are no secret. Ratings actions by the agencies for companies that are privately-owned but with publicly-traded debt can offer a window into finances that might not otherwise be available.GXO’s stock for the past year has been weak, falling about 3.9%. But it has been on a positive run of late with a 3-month increase of about 23.4% and 1-month increase of just under 18%. It was one of the strongest logistics stocks in the second quarter.S&P’s move to take a negative outlook on GXO came when it announced not only the acquisition of Wincanton but also its almost $1 billion financing plan. But Moody’s view, more than a year later, is more positive.“The upgrade of the senior unsecured rating reflects our expectation that GXO’s financial leverage will remain modest following the successful acquisitions of Wincanton plc in 2024 and Clipper Logistics in 2022,” the agency said. “We also expect the company’s strong and defensible market position within the logistics sector to result in continued strength and resilience in GXO’s operating results.”Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P 5006,198.03 -6.92 (-0.11%)Dow 3044,537.44 +442.67 (+1.00%)Nasdaq20,216.94 -152.79 (-0.75%)Russell 20002,214.41 +39.37 (+1.81%)VIX16.89 +0.16 (+0.96%)Gold3,351.50 +43.80 (+1.32%)PortfolioSign in to access your portfolioSign inTop gainersBMNR Bitmine Immersion Technologies, Inc. 67.88 +33.98 (+100.03%)RUN Sunrun Inc. 9.19 +1.01 (+12.34%)MLCO Melco Resorts & Entertainment Limited 8.10 +0.87 (+12.03%)PII Polaris Inc. 45.44 +4.79 (+11.78%)DFH Dream Finders Homes, Inc. 27.86 +2.73 (+10.86%)Top losersPRGS Progress Software Corporation 57.40 -6.44 (-10.09%)CRK Comstock Resources, Inc. 25.26 -2.41 (-8.71%)LEU Centrus Energy Corp. 169.64 -13.54 (-7.39%)BUR Burford Capital Limited 13.09 -1.17 (-8.20%)AVAV AeroVironment, Inc. 262.57 -22.38 (-7.85%)Most activeLCID Lucid Group, Inc. 2.0650 -0.0450 (-2.13%)NVDA NVIDIA Corporation 153.52 -4.47 (-2.83%)TSLA Tesla, Inc. 303.40 -14.26 (-4.49%)F Ford Motor Company 11.38 +0.52 (+4.84%)HOOD Robinhood Markets, Inc. 90.62 -3.01 (-3.22%)Earnings eventsTrending tickersTSLA Tesla, Inc. 303.83 -13.83 (-4.35%)WOLF Wolfspeed, Inc. 0.8366 +0.4378 (+109.78%)UNH UnitedHealth Group Incorporated 324.27 +12.30 (+3.94%)BGLC BioNexus Gene Lab Corp. 10.44 +7.31 (+233.55%)TGT Target Corporation 105.11 +6.46 (+6.54%)Top economic events