Moody’s cuts Odyssey rating amid weak freight market

Core Viewpoint - Odyssey Logistics has experienced a downgrade in its debt rating by Moody's Ratings, following a similar downgrade by S&P Global, indicating a bleak outlook for the freight market and the company's financial health [1][4]. Group 1: Rating Changes - Odyssey's Corporate Family Rating was downgraded from B2 to B3 by Moody's, with its probability of default rating also reduced to B3-PD from B2-PD [3][6]. - The senior secured first lien bank credit rating was cut to B3 from B2, placing it deep into the non-investment grade category, which is six notches below the investment grade cutoff [4][6]. - S&P Global had previously downgraded Odyssey's rating to B- in June, which is equivalent to Moody's B3 rating [4]. Group 2: Historical Context - The previous B2 rating had been affirmed by Moody's in March 2024 and July 2023, and it was raised to that level in August 2022 [7]. - Moody's had maintained a stable outlook on Odyssey's rating for three years before the recent downgrade, which is not typical as downgrades usually follow a negative outlook [5][6]. Group 3: Financial Metrics - Moody's anticipates that Odyssey's financial leverage will remain above a 7X debt/EBITDA level through the end of the year, indicating elevated debt ratios that are critical for assessing the company's financial position [8].