Investing.com -- S&P Global Ratings has upgraded its long-term issuer credit rating for online travel agency eDreams ODIGEO S.A. to ’B+’ from ’B’. This upgrade follows eDreams’ strong operating performance for fiscal 2025, which ended on March 31, and its successful execution of its Prime strategy. The company’s member base grew by 25% year over year, reaching 7.3 million members. In fiscal 2025, eDreams saw its leverage decrease to 4.2x from 6.5x in 2024. Its free operating cash flow (FOCF) remained strong at €69 million ($82 million), compared to €67 million ($79 million) in 2024. The company is now seeking to refinance its capital structure, planning to extend and increase its super senior revolving credit facility (RCF) from €180 million to €185 million ($214 million to $219 million). Additionally, eDreams plans to issue new €375 million ($444 million) senior secured notes, extending the maturity of both instruments to 2030. S&P Global Ratings also upgraded its issue rating on the extended super senior RCF to ’BB’ from ’BB-’, while the ’1’ recovery rating on the facility remained unchanged. The agency assigned a ’B+’ issue rating and a ’3’ recovery rating to the proposed senior secured notes. The agency expects travel demand to remain resilient despite ongoing macroeconomic challenges. It also anticipates that eDreams will continue its successful track record in increasing and retaining its Prime membership, which should result in a decrease in leverage to approximately 3.0x and a FOCF of €100 million ($118 million) in 2026. eDreams’ solid operating performance and improved credit metrics were driven by strong growth in its Prime membership. The company’s revenue increased to €671 million ($795 million) in fiscal 2025 from €643 million ($762 million) in 2024, partly due to the expanded Prime membership base and despite a lower average revenue per unit. The company’s EBITDA margin improved to 13.4% from 9.0%, supported by the increasing longevity of Prime members, which reduces customer acquisition costs. S&P Global Ratings expects eDreams to continue expanding its Prime model, leading to further improvement in credit metrics. The agency forecasts that Prime subscriptions will surpass 8 million by the end of fiscal 2026, supported by higher renewal rates and increased market penetration. It also predicts that eDreams’ adjusted leverage will trend toward 3.0x in fiscal 2026, with FOCF increasing to about €100 million ($118 million). The company’s proposed refinancing aims to strengthen its debt maturity profile and is expected to be leverage neutral. Post-transaction, eDreams is estimated to have available liquidity of approximately €205 million ($243 million), sufficient to support the company’s operations for at least the next 12 months, barring any disruptions that could increase working capital needs or constrain cash flow expectations. Despite the positive outlook, S&P Global Ratings noted some constraints on eDreams’ rating due to the limited track record of its Prime membership program. The market for subscription-based travel offerings is still relatively new, and it’s uncertain how much it will grow. The agency also acknowledged risks associated with ongoing disputes with Ryanair, which have contributed to a decline in non-Prime bookings. The stable outlook reflects S&P Global Ratings’ expectation that travel demand will remain resilient throughout 2025, despite ongoing macroeconomic challenges. The agency also expects eDreams to continue increasing and retaining its Prime membership base, projecting that the company will generate a FOCF of approximately €100 million ($118 million) and an adjusted debt to EBITDA ratio trending toward 3x in fiscal 2026. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Investing.com -- Moody’s Ratings has announced an upgrade in Grifols (BME:GRLS) S.A.’s corporate family rating (CFR) and probability of default rating (PDR) from B3 to B2. The instrument ratings of the backed senior secured instruments issued by Grifols, Grifols World Wide Operations Ltd., and Grifols World Wide Operations USA, Inc. have also been upgraded from B2 to B1. Additionally, the instrument ratings of the backed senior unsecured instruments issued by Grifols Escrow Issuer, S.A.U. have been upgraded from Caa2 to Caa1. The outlook for all entities remains positive. The upgrade is a reflection of Grifols’ strong operating performance, robust revenue, and profitability growth, and improved management execution, which has led to an improvement of its key credit metrics. Moody’s expects Grifols’ gross leverage to trend below 6.5x by the end of 2025 from 7x for the last twelve months to March 2025, and its EBITDA to interest expense to be around 3x in 2025. The company’s free cash flow (FCF) is forecasted to be about €250-270 million over the next 12-18 months and continued good liquidity. The positive outlook is based on expectations that Grifols’s operating performance and credit metrics will continue to improve over the next 12-18 months. Specifically, its gross leverage is forecasted to trend towards 5.5x, with an EBITDA to interest expense above 3x, and increasing cash generation. The B2 rating also reflects Grifols’ strong market position, scale, and vertical integration in human blood plasma-derived products, which are relevant for the industry. The rating also considers the company’s current high leverage, high capital intensity of the business, and working capital requirements which can have large swings during the fiscal year, and are important drivers of FCF. Grifols’ liquidity is seen as good, supported by €753 million of cash balances at the end of March 2025, and a fully available revolving credit facility (RCF) of $938 million due in May 2027. The company’s next debt maturities are about €3 billion due in 2027. The rating could be upgraded if there is a continued improvement to operating, financial performance, profitability, and cash flow generation. However, the rating could be stabilized if the expected gradual improvement of key credit metrics does not materialize over the next 12-18 months. Conversely, the rating could be downgraded if Grifols’ operating performance weakens, leading to a worsening of credit metrics. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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Summary I am upgrading Lam Research to a Buy, driven by robust wafer fabrication equipment demand and memory supply bottlenecks. Revised wafer fab spending forecasts now call for 10–15% YoY growth, supporting higher sales and margin expansion for LRCX. The base case price target is $246.84 (13% upside), with a bullish scenario at $291.11; EBITDA and free cash flow estimates are significantly raised. Though LRCX trades at a premium to historical multiples, strong cash returns (80–85% of FCF) and sector tailwinds justify upside risk. Looking for a helping hand in the market? Members of The Aerospace Forum get exclusive ideas and guidance to navigate any climate. Learn More » Lam Research Corporation (LRCX) surged 8.3% in pre-market trading following a report from Stifel outlining expectations that wafer fabrication spending would increase 10-15% this year, up from prior expectations of 7-8%. I covered Lam Research in May 2025 with a More on my IG service If you want full access to all our reports, data and investing ideas, join The Aerospace Forum, the #1 aerospace, defense and airline investment research service on Seeking Alpha, with access to evoX Data Analytics, our in-house developed data analytics platform. Dhierin-Perkash Bechai is an aerospace, defense and airline analyst. Dhierin runs the investing group The Aerospace Forum, whose goal is to discover investment opportunities in the aerospace, defense and airline industry. With a background in aerospace engineering, he provides analysis of a complex industry with significant growth prospects, and offers context to developments as they occur, describing how they might affect investment theses. His investing ideas are driven by data informed analysis. The investing group also provides direct access to data analytics monitors. Learn more. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Discover why Mercury Systems is rated a buy: strong earnings, robust demand, EBITDA growth, and 30% upside potential. Target price set at $86.50.