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Bond Market News

Dell Emerges as Rising Star After Two-Notch Upgrade to IG Status at BBB by S&P

American tech major Dell Technologies Inc. received a two-notch upgrade to BBB from BB+ by S&P on Wednesday. The S&P upgrade makes Dell a rising star, a title given to companies whose ratings have been upgraded to investment grade from junk by at least two of the three major rating agencies. S&P’s upgrade comes just over a week after Fitch upgraded it to BBB- from BB. S&P said that Dell’s pro forma adjusted leverage profile is better than what they had anticipated back in April when it placed Dell on CreditWatch positive. The rating agency added that given its continued PC strength “coupled with Dell’s plans to reduce its funded debt by at least $16 billion through VMware dividend proceeds, cash flow generation and cash on hand, we now believe Dell’s pro forma adjusted leverage post-spinoff will be near 1x area upon close of fiscal 2022.”

Dell’s 6.2% 2030s traded steady at 127.45 yielding 2.59%.

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