Moody’s revises Quorum Health to negative

Moody's Investors Service said it changed the outlook of Quorum Health Corp. to negative from stable and lowered its speculative grade liquidity rating to SGL-3 from SGL-2.

The agency also affirmed all of the company's remaining ratings, including its B2 corporate family rating and B2-PD probability of default rating.

Moody’s said the outlook change reflects a revision in its expectation of Quorum's profitability since its separation from Community Health Systems, Inc. in April 2016.

EBITDA will be lower than the agency previously anticipated as the company faces weak volume trends and considerable costs associated with the separation. This in turn will negatively impact Quorum's credit metrics and its ability to reduce leverage in the near-term.

Moody's estimates that pro forma debt/EBITDA could reach 7.1 times at the end of 2016.

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