Credit Rating ModelFree Financial Model Download

This credit rating model calculates leverage and coverage ratios from a three-statement projection and maps them to implied credit ratings (BBB, BB, B, etc.) using agency-published rating scales. It projects leverage (total debt / EBITDA), interest coverage (EBITDA / interest), DSCR (debt service coverage ratio), loan-to-value (LTV), and other metrics; then applies lookup tables benchmarking those metrics against Moody's or S&P rating thresholds to estimate what rating a debt issuance would likely receive. It includes rating outlook and rating triggers, flagging when performance deteriorates sufficiently to trigger a downgrade watch or negative outlook.

The model includes an assumptions section with leverage and coverage thresholds for each rating category; a calculations section projecting the subject company's financial metrics across a 5-year period; a rating determination section that looks up the implied rating in each year based on leverage, coverage, and qualitative factors; and a sensitiv table showing how ratings change if key assumptions (EBITDA growth, leverage target, interest rate) shift. Outputs include a rating waterfall showing the path from entry to exit rating, and heat maps identifying periods of rating stress.

This model is used by corporates managing their credit profile and capital structure to maintain or improve ratings; credit analysts evaluating issuers; lenders assessing credit risk for commercial loans; and investment committees evaluating fixed-income holdings. It provides forward-looking insight into credit trajectory without waiting for agencies to publish their ratings.