Downgrade Details

JetBlue Airways Downgraded by Ratings Agencies Amid $3 Billion Debt Raise

Downgrade Details

* Standard & Poor's (S&P Global Ratings) downgraded JetBlue's corporate credit rating from 'BBB-' to 'BB+'. * Moody's Investors Service downgraded JetBlue's senior unsecured notes from 'Ba2' to 'B1'.

Reasons for Downgrade

* The downgrades reflect concerns about JetBlue's increased debt burden and the impact of the COVID-19 pandemic on the airline industry. * In November 2022, JetBlue announced plans to raise $3 billion through a senior secured notes offering. * The proceeds will be used to refinance existing debt, fund aircraft purchases, and provide additional liquidity.

Impact on JetBlue

* The downgrades could lead to higher borrowing costs for JetBlue in the future. * However, the airline has maintained a strong balance sheet and liquidity position, which is expected to support its operations.

Analyst Commentary

* S&P analyst Philip Baggaley noted that the downgrade reflects "JetBlue's increased leverage and the ongoing challenges facing the airline industry." * Moody's analyst Jonathan Root said that the downgrade was "driven by the anticipated increase in JetBlue's debt levels, which will weaken its credit metrics."

Share Price Impact

* JetBlue's shares fell 4% in premarket trading following the announcement of the downgrades.

Sources

* [Reuters](https://www.reuters.com/business/aerospace-defense/jetblue-airways-downgraded-sp-moodys-sources-2023-03-07/) * [S&P Global Ratings](https://www.spglobal.com/ratings/en/research/articles/230307-jetblue-airways-corporation-downgraded-to-bb-outlook-negative-12256140) * [Moody's](https://www.moodys.com/research/Moodys-downgrades-JetBlue-Airways--PR_468597)