HASI Secures Second Investment Grade Credit Rating
Hannon Armstrong Sustainable Infrastructure Capital (HASI) has announced that it received a BBB- investment grade credit rating from Fitch Ratings. This is HASI's second investment grade rating, with the first being a Baa3 rating from Moody’s since June 2022. Fitch highlighted HASI's enhanced business profile, improved funding flexibility, strong asset quality, solid operating performance, and leverage within the targeted range. The upgrade is also attributed to HASI's proven track record in renewable energy financing, robust securitization platform, enhanced liquidity, and experienced management. According to CFO Marc Pangburn, this dual investment grade status will allow HASI's bonds to be included in investment grade indices, increasing access to low-cost, long-duration debt capital.
- HASI secures a second investment grade rating of BBB- from Fitch.
- The company maintains an investment grade rating of Baa3 from Moody’s since June 2022.
- Fitch's upgrade reflects HASI's enhanced business profile and improved funding flexibility.
- Strong asset quality and solid operating performance cited by Fitch.
- Leverage remains within the targeted range.
- Proven track record in renewable energy financing highlighted.
- Large and profitable securitization platform recognized.
- Enhanced liquidity and experienced management team mentioned as strengths.
- Dual investment grade ratings can increase access to low-cost, long-duration debt capital.
- Inclusion of HASI's bonds in investment grade indices expected.
- No immediate financial figures or revenue impacts reported in the PR.
- The BBB- rating is the lowest investment grade, indicating moderate credit risk.
- Dependency on maintaining leverage within the targeted range for continued positive ratings.
Insights
The recent investment grade rating of BBB- from Fitch for Hannon Armstrong Sustainable Infrastructure Capital, Inc. (HASI) is a noteworthy development for investors. This rating, coupled with the existing Baa3 rating from Moody’s, positions HASI favorably in the debt markets. Investment grade ratings are important as they signify lower credit risk, making the company's bonds more attractive to a broader range of institutional investors, including those who are restricted to holding only investment-grade securities.
Enhanced funding flexibility, as mentioned in the Fitch report, will likely translate into better terms for borrowing, which in turn can positively impact HASI’s
For retail investors, the investment grade rating indicates a level of financial stability and a lower likelihood of default, making HASI a potentially safer investment compared to lower-rated counterparts. However, investors should remain vigilant and consider the broader economic environment and how it may impact HASI’s operations and renewable energy projects.
The achievement of a second investment grade rating by HASI is not just a testament to its strong financial management but also a significant indicator of confidence in the company’s business model and its role in the renewable energy sector. This rating can open doors to being included in investment grade indices, which could lead to increased demand from institutional investors and potentially a positive movement in the company’s share price.
Furthermore, HASI's focus on renewable energy financing aligns well with the global shift towards sustainable energy solutions. The company's large and profitable securitization platform provides it with a competitive edge, allowing it to monetize its assets efficiently and reinvest in new projects. For investors, this means that HASI is well-positioned to capitalize on the growing demand for clean energy investments.
In summary, the new rating is a clear positive for HASI, reflecting its solid operational performance and strategic positioning within the market.
The securing of a second investment grade rating has legal implications as well. Investment grade ratings often lead to improved covenants and terms in debt agreements, which can be more favorable for the issuer. For HASI, this means that ongoing and future financing deals could come with reduced restrictions and lower collateral requirements, providing greater operational flexibility.
Additionally, the positive rating from Fitch further solidifies HASI's reputation in the financial world, potentially reducing the company's exposure to legal risks associated with financing and debt restructuring. Institutional investors might also view HASI as a more credible and reliable partner, which can lead to further business opportunities and strategic alliances.
From a legal perspective, this rating can be seen as a strong endorsement of HASI's governance and adherence to regulatory standards, offering assurance to investors regarding the company's compliance and risk management practices.
In its report, Fitch stated that HASI’s upgrade reflects the Company’s enhanced business profile, improved funding flexibility, continued strong asset quality, solid operating performance, and maintenance of leverage within the targeted range. The report also cites the Company’s proven track record in the renewable energy financing sector, large and profitable securitization platform, enhanced liquidity, and experienced management team.
“Two investment grade ratings will enable our bonds to be included in investment grade indices, increasing our access to low-cost, long-duration debt capital," said Marc Pangburn, Chief Financial Officer of HASI. "Achieving investment grade is a testament to our strong financial position, consistent track record of execution, and resilient business model.”
About HASI
HASI (NYSE: HASI) is a leading climate positive investment firm that actively partners with clients to deploy real assets that facilitate the energy transition. With more than
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Media:
Conor Fryer
media@hasi.com
443-321-5754
Investors:
Neha Gaddam
investors@hasi.com
410-571-6189
Source: Hannon Armstrong Sustainable Infrastructure Capital, Inc.
FAQ
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