Convergint's outlook has turned negative, according to bond rater Moody's, released shortly after IPVM's report about Convergint's billion dollars in junk debt.
Numerous Convergint employees were outraged by IPVM's report, even claiming that junk made up "95% of the market". This is wrong, per S&P, it is just 28% of the market. Junk debt is dangerous, especially so in the coronavirus crisis.
The chart below overviews Convergint's debt-fueled acquisition boom, their ambitious hopes to hit $2.3 billion revenue in 2023 and Moody's expectation of sharply declining revenue for 2020:
Inside this report, we examine these 3 dynamics, including the key positive factors Convergint has going for it, the downward pressure from the debt and Coronavirus and the future challenges for the once high flyer.
Moreover, we examine the details of the financial covenant on Convergint's debt and how this restricts their ability to operate and puts more pressure on their employees.