Moody’s Investors Service has announced that, for the second quarter of 2007, downgrades outpaced upgrades by a ratio of 1.3 to 1--relatively consistent with historical trends over the past three years. And through the first half of 2007, downgrades outpace upgrades 1.4 to 1.
According to the service, the main drivers of the downgrades in the second quarter were continued deterioration in operating performance and liquidity. Four of the downgraded providers added a sizeable amount of debt after experiencing poor financial performance as a result of operating in difficult service areas that were either highly competitive or had a high Medicaid population. Also, the majority of the downgraded providers in the second quarter of 2007 were in the mid to high investment grade category.
For more information, contact Moody’s at 212-553-4431.
