S&P rates Penske Truck revolver BBB-

Standard & Poor's said it assigned its BBB- issue-level rating to Penske Truck Leasing Co. LP and PTL Finance Corp.'s $1.1 billion unsecured revolving credit facility maturing March 9, 2020.

S&P said the ratings reflect Penske’s strong market position in full-service truck leasing and commercial truck rentals, with revenues generated primarily through long-term leases that produce relatively strong and stable cash flows, even in periods of economic weakness.

The ratings also reflect Penske's substantial debt usage, which results in a funds-from-operations (FFO)-to-debt ratio in the low-20% area and a debt-to-capital ratio in the mid-70% area (as a transportation equipment lessor, Penske can support higher debt leverage than industrials that we rate similarly).

The agency assesses Penske's business risk profile as "satisfactory" and its financial risk profile as "significant" based on the criteria.

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