S&P Affirms Disney A- Credit Rating, Positive Outlook Despite “Strategic Uncertainties” After Bob Iger Interview

deadline.com:

S&P today affirmed its A- investment grade credit rating for Disney after CEO Bob Iger, in a recent interview with CNBC, injected a big dose of uncertainty into what the company may look like going forward.

Iger said he and the board are considering a number of strategic options for ESPN and linear television, “Some of these options could change Disney’s business mix over the longer term.” the the giant ratings agency said in a note Tuesday.

Iger recently brought on former top Disney executives Tom Staggs and Kevin Mayer to consult on options for ESPN. The two are co-CEOs of Candle Media.

S&P also affirmed its “positive” outlook, anticipating the media giant will continue to reduce leverage this year and next. “The outlook is positive, reflecting our expectations that leverage could decline…depending on how the Hulu put-call is resolved and how its direct-to-consumer (DTC) segment performs.” (Leverage is a ratio of debt to equity.) Iger, in the interview, discussed secular pressure on the media and entertainment industry, its impact on Disney, and potential strategic moves as reviews its portfolio of broadcast and cable TV networks, excluding flagship sports net ESPN. “It may reach the conclusion that those networks are no longer core.