hard · Corporate Credit Analysis
Lunar Real Estate has $500M of senior unsecured notes maturing in 2030 and $300M maturing in 2032. It also has a $400M revolver maturing in 2029.
If its LTM FOCF is $100M, which of the following represents the most significant structural credit risk?
- High interest rate sensitivity on its fixed-rate bond portfolio.
- Negative working capital seasonality causing intra-quarter defaults.
- Asset-liability mismatch between long-term leases and short-term debt.
- A maturity wall in 2029-2030 that exceeds cumulative cash flow generation.
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