Moody's Upgrades OUTFRONT Media Rating to Ba3

Moody's Upgrades OUTFRONT Media on Financial Strength

Moody's Ratings has upgraded OUTFRONT Media Inc.'s Corporate Family Rating (CFR) to Ba3 from B1, assigning a stable outlook. The upgrade reflects expectations of declining financial leverage and a more conservative financial policy.

Overview of Financial Performance

The rating agency anticipates OUTFRONT's leverage will fall to the low 4x range within 12-18 months, a significant improvement from the 4.6x recorded in the third quarter of 2025. This is driven by strong revenue and EBITDA growth, with margins exceeding 50%. The company's strategic conversion of static billboards to digital displays and its focus on programmatic advertising are yielding attractive returns and expanding margins.

Market Impact and Outlook

This upgrade positively reflects on OUTFRONT's strong market position in the U.S. outdoor advertising sector. The industry benefits from high barriers to entry due to regulatory restrictions and the hard-asset nature of billboards. However, Moody's noted risks, including a high concentration in New York City, which accounts for 55% of its displays, and a long-term contract with the NY MTA with unfavorable economics. The company maintains good liquidity, supported by an undrawn $500 million revolver.

Summary

The Ba3 rating upgrade underscores confidence in OUTFRONT Media's deleveraging path and operational strategy. While concentration risks persist, the company's strong market position and healthy liquidity provide a stable foundation for future performance. Investors will monitor its ability to manage contractual obligations and diversify its market presence.

FAQ

Q: Why did Moody's upgrade OUTFRONT Media's rating?
A: The upgrade was based on expectations for declining financial leverage, strong revenue and EBITDA growth, and a successful digital conversion strategy.

Q: What is OUTFRONT Media's new corporate rating?
A: The company's Corporate Family Rating was upgraded to Ba3 from B1 with a stable outlook.

Source: Investing.com