Highlights

  • Loomis Sayles credit researchers believe that integrated power producers (IPPs) in the state of Texas will survive the Texas energy crisis given their generally strong balance sheets and large liquidity facilities.
  • The crisis could delay a high yield IPP’s timeline to investment grade as rating agencies reassess the market.
  • In the long run, IPPs are likely to benefit from new customers seeking dependable retailers with a good brand, even if that comes at a premium cost. As important, Loomis Sayles credit researchers believe the IPPs could realize a new source of income as an incentive to keep assets alive for reliability purposes.
This material is provided for informational purposes only and should not be construed as investment advice. The views and opinions expressed may change based on market and other conditions.­­ All investing involves risk, including the risk of loss. Investment risk exists with equity, fixed income, and alternative investments. There is no assurance that any investment will meet its performance objectives or that losses will be avoided. Investors should fully understand the risks associated with any investment prior to investing.

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