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More US companies skip lender consent to add on debt, Moody's says
By Matt Tracy (Reuters) -A growing number of U.S. companies are seeking more flexible covenants in their credit agreements to increase their debt loads while avoiding approvals from all their existing lenders, according to a new report by ratings agency Moody's Ratings. Moody's said in a report released on Thursday that U.S. corporate borrowers with weaker credit profiles were leaning harder on their lenders to get more flexibility in agreements to take out more debt without full consent from existing lenders, as they struggled to issue new debt in public markets. Shop Top Mortgage Rates A quicker path to financial freedom Personalized rates in minutes Your Path to Homeownership Deals with covenant changes that ensured a boost to a company's capacity to raise more debt - whether for opportunistic purposes or to avoid liquidity crunches - amounted to as much as 40% to 300% of their EBITDA, according to Moody's. Such dramatic debt load increases present a major credit risk to existing lenders, especially when borrowers' private equity sponsors use the added debt for dividend recaps, add-ons and acquisitions, the ratings agency noted. Borrowers on several recent deals have sought more flexible covenants to allow this greater debt capacity, it said, adding that 10%, or nine of 89 credit agreements, have done so between the start of 2024 and May 2025. All of the 10% involved PE-backed borrowers, the report noted. They included the initial proposed term sheets for debt that was funding PE firm Turn/River Capital's leveraged buyout of IT systems provider SolarWinds in March, and KKR's leveraged buyout in May of derivatives market software provider OSTTRA. These recent deals point to a growing trend of borrowers' "unfettered access" to debt, even those in financial distress, Moody's highlighted, as lenders in the public debt market face ever fiercer competition from lenders in the expanding private credit market. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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25 minutes ago
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Zeekr Boosts Margins, Slashes Losses As New Models Power Sales
ZEEKR Intelligent Technology (NYSE:ZK), a premium electric vehicle (EV) unit of Geely Auto, reported fiscal second-quarter results on Thursday. The company reported quarterly revenue of 27.43 billion Chinese yuan, representing a decrease of 0.9% year-on-year (Y/Y). In U.S. dollars, revenue totaled $3.83 billion. The revenue grew by 24.6% quarter-on-quarter (Q/Q).Total vehicle deliveries were 130,866 units for the quarter, representing a 9.3% Y/Y increase and a 14.8% Q/Q increase. The Zeekr brand delivered 49,337 vehicles. Meanwhile, the Lynk & Co brand delivered 81,529 vehicles, with 58.8% of deliveries coming from NEV models. The premium electric vehicle company's adjusted net loss per ADS was 1.42 Chinese yuan. In U.S. dollar terms, the company reported adjusted net loss per ADS of 20 cents. Vehicle sales revenue were 22.92 billion Chinese yuan ($3.2 billion) for the quarter, representing an increase of 2.2% Y/Y driven by higher sales volume of the Lynk & Co brand, partially offset by lower sales volume of the Zeekr brand. The revenue grew by 20.0% Q/Q, mainly driven by sales growth resulting from the launch of new models. View more earnings on ZK The vehicle margin was 17.3%, up from 11.5% in the prior year quarter, driven by sustained cost-saving initiatives. The prior quarter margin was 16.5%. Revenues from other sales and services declined 13.8% Y/Y to $630 million for the quarter, due to a decrease in R&D revenue from related parties. The revenue grew by 54.5% Q/Q due to the increased overseas sales of battery packs and electric drives. The gross margin expanded to 20.6% for the quarter from 18.0% a year ago. The prior quarter margin was 19.1%. Adjusted net loss was $51 million for the quarter, down by 81.2% Y/Y. The loss declined by 38.8% Q/Q. As of June 30, 2025, cash and cash equivalents and restricted cash stood at 10.21 billion Chinese yuan ($1.43 billion). Zeekr stock gained 4.4% year-to-date signifying intense electric vehicle competition from the likes of Tesla (NASDAQ:TSLA), Nio (NYSE:NIO). Price Action: ZK shares are trading higher 1.21% to $29.99 premarket at last check Thursday. Photo by aapsky via Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Zeekr Boosts Margins, Slashes Losses As New Models Power Sales originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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25 minutes ago
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Where Will Arista Networks Stock Be in 3 Years?
Key Points Its revenue and earnings jumped impressively last quarter thanks to the huge addressable market. Its components play a central role in AI data centers, and it has been gaining a greater share. While the stock is expensive right now, outstanding growth could help it justify the valuation. 10 stocks we like better than Arista Networks › Arista Networks (NYSE: ANET) is a key player in the cloud computing industry, as its networking components and software offerings enable fast data transmission in data centers. The company is now benefiting from the heavy investments in artificial intelligence (AI) infrastructure. This explains why Arista's latest results for the second quarter turned out to be better than Wall Street's expectations. Arista stock shot up more than 17% following the release of its quarterly results on Aug. 5. Arista didn't just beat expectations -- it also raised its full-year revenue guidance substantially. Arista's latest pop brings the stock's gains over the past three years to a whopping 360% as of this writing. However, will the company be able to sustain this impressive momentum over the next three years as well? Let's find out. Arista Networks' growth rate is likely to improve further Arista's Q2 revenue shot up 30% year over year to $2.2 billion, while its non-GAAP earnings jumped nearly 38% from the year-ago period to $0.73 per share. The company points out that the strong demand for its networking components, such as switches and routers, from AI hyperscalers and cloud computing providers was the catalyst behind its robust growth. Even better, Arista is now expecting its 2025 revenue to increase by 25%, as compared to the earlier estimate of 17%. Looking ahead, the possibility of Arista further increasing its guidance cannot be ruled out. After all, the company points out that the high-speed networking delivered by its switches and routers can reduce the operating costs of AI data centers. Arista claims that 30% to 50% of the processing time in data centers is wasted in transferring data in AI clusters powered by graphics processing units (GPUs). The company's offerings allow data center operators to improve their network utilization rates, thereby leading to lower costs. Not surprisingly, the company expects its AI-related networking revenue to exceed its $1.5 billion estimate in 2025. The company is confident of maintaining healthy growth in the AI business in the long run as well, and that's not surprising. Grand View Research is projecting a 4x jump in the data center networking market's revenue between 2025 and 2033 to almost $155 billion at the end of the forecast period. Arista itself sees its total addressable market (TAM) jumping to $70 billion by 2028 from $41 billion last year. This increase in the company's TAM over the next three years should ensure healthy growth for the company, especially considering its improving market share. Arista points out that it controlled a third of the high-speed data center switching market at the end of 2024, up by 3.5 percentage points from the previous year. Importantly, Arista has been gradually taking share away from Cisco Systems in this space over the past several years, with its market share growing from just 3.5% in 2012 to more than 30% last year. So, a combination of market share gains and the overall growth of the data center networking market could help this AI stock deliver more upside. However, investors may be concerned about one thing right now. The stock is expensive right now Though Arista Networks has been growing at a nice clip, the stock seems to have run ahead of itself if we take a closer look at its valuation. Its price-to-earnings ratio of 54 is on the expensive side, which means that it will have to continue outperforming analysts' expectations consistently to sustain its stock market rally. But the good part is that Arista's growth estimates have been hiked for the next three years following its latest quarterly report. We have already seen that Arista's potential revenue opportunity is on track to jump significantly. Additionally, its market share has been improving. So, Arista seems capable of outperforming Wall Street's estimates over the next three years. In fact, the company expects to achieve its $10 billion annual revenue target in 2026, two years ahead of its original expectation. As such, there is a strong possibility of Arista's growth turning out to be better than estimates, which should allow it to justify its premium valuation and deliver more gains to investors over the next three years. Should you invest $1,000 in Arista Networks right now? Before you buy stock in Arista Networks, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Arista Networks wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $660,783!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,122,682!* Now, it's worth noting Stock Advisor's total average return is 1,069% — a market-crushing outperformance compared to 184% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 13, 2025 Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Arista Networks and Cisco Systems. The Motley Fool has a disclosure policy. Where Will Arista Networks Stock Be in 3 Years? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
