The S&P recently reduced the Guitar Center's corporate credit rating further into junk status. S&P does not see the retailer — with more than 250 stores across the U.S. — improving its credit metrics given high leverage and weak cash flow, especially as more than $600M in notes mature in April of next year, according to MarketWatch.
Guitar Center remains in operation, just on a watch list with a host of other retailers in precarious positions. That means the retailer is susceptible to any shocks, including a recession or a sharper drop in guitar sales, Digital Music News reports. Lower guitar sales are also the source of guitar-maker Gibson's tribulations. Gibson is saddled with more than $500M in debt coming due this summer.. . . more