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S&P Affirms RXO Debt Rating Despite Freight Market Uncertainty

S&P Global Ratings held RXO's BB debt rating steady while maintaining a negative outlook on the third-party logistics provider. The rating agency expressed skepticism about the durability of recent trucking price increases, citing unclear market sustainability as a factor in its decision. RXO's BB rating contrasts with Moody's Ba1 assessment, creating a one-notch divergence between the two agencies. S&P said the company's credit metrics should improve over the next two years if spot market prices rise as expected. However, the negative outlook reflects concerns that RXO may struggle to boost profitability and credit measures to necessary levels for rating stabilization. S&P downwardly revised its business risk profile assessment, noting that RXO's margins have consistently underperformed compared to rated logistics peers. The agency acknowledged early signs of freight market improvement but signaled that conditions remain insufficient to warrant an upgrade.