S&P rating outlook
What is the S&P outlook?
S&P outlook is a forecast by Standard & Poor's that reflects the agency's expectations regarding the possible change in a long-term credit rating over the intermediate term (typically six months to two years). An outlook is not a rating itself but serves as an indicator of potential changes based on current economic and financial trends.
Why is the S&P outlook important?
The S&P outlook provides investors with crucial early signals about potential changes in credit quality before an actual rating adjustment occurs. It is an important tool for assessing investment risks based on current economic and financial data.
There two types of outlook are available:
S&P outlook
The S&P outlook for bonds reflects the agency's expectations regarding the creditworthiness of a specific bond (S&P rating). This forecast helps investors assess the likelihood of changes in the bond's rating, which could affect its attractiveness as an investment.
Issuer S&P outlook
The Issuer S&P outlook covers the overall financial stability of a company or other legal entity (Issuer S&P rating). The forecast helps investors evaluate how the issuer ratings might change, impacting its overall creditworthiness and ability to meet financial obligations.
Possible values:
- Positive
- Negative
- Stable
- Developing
- Not meaningful
- Not rated
- Never rated
Positive
Indicates a potential upward trend in the rating, suggesting improvements in the issuer's financial condition and capacity to meet financial commitments.
Negative
Suggests a potential downward trend, indicating deteriorating financial conditions or increased vulnerabilities that could lead to a downgrade.
Stable
Implies that the rating is unlikely to change in the foreseeable future, reflecting a steady financial and economic state.
Developing
Indicates uncertainty about the direction of the rating due to evolving circumstances that could move it either up or down.
Not meaningful
Used rarely, this designation implies that providing an outlook is not considered informative due to specific conditions.
Not rated
No outlook has been assigned.
Never rated
The entity or obligation has never been rated.