Monday, December 30, 2024
Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
New Amendment. As CVG continues to implement strategic portfolio actions, including paying down debt to create a more streamlined, lower cost entity, the Company amended its credit agreement. In the amendment, CVG’s existing term loan facility is reduced to $85 million from $175 million, while the revolving credit facility is reduced to $125 million from $150 million. At the end of September, CVG had approximately $115 million outstanding under the term loan and $14 million outstanding under the revolver. The maturity date of the credit facilities remains May 12, 2027.
Rate Changes. The new amendment altered the rate and leverage table. If the leverage ratio is 4:1 or above, the maximum SOFR loan rate is now at SOFR +3.25%, and the base rate loan is now at base rate +2.25%. Previously, the maximum rates of SOFR +2.75% and base +1.75% were hit at a leverage ratio of 3.5:1.
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