While Standard & Poor’s has confirmed Callaway Golf Company’s credit rating because of better-than-expected results, Moody’s has lowered its corporate family rating and that of its senior secured loan, to B1-PD, while giving the company a higher probability of default because of the coronavirus pandemic. It feels that Callaway’s operating results have been weakened by temporary government-mandated closures of operating facilities and stores. Moody’s admits that its sales declines have abated in recent months due to a recovery of the golf equipment market, but it feels that it will take years for its apparel business to improve because of “more challenging competitive dynamics.” Moody’s noted that Callaway’s debt and leverage have increased in recent years to fund new acquisitions include the purchase of Jack Wolfskin in January 2019. Callaway’s debt-to-Ebitda ratio of more than 5 times is high, but both S&P and Moody’s said they would consider an upgrade if the company gets its under 4 times Ebitda, maintaining good liquidity.