Fitch Ratings upgraded STORE Capital Corp.'s ratings to BBB from BBB-, with a stable outlook.
The upgraded ratings include the company's issuer default, senior unsecured revolving credit facility, senior unsecured term loan and senior unsecured note ratings.
Fitch attributed the upgrade to STORE's strong management team, solid credit metrics, unique investment approach and diversified portfolio. It also lauded the company's commitment to strengthening its financial metrics, particularly in keeping its leverage in the 5.5x to 6.0x area.
The rating agency, however, expressed concern over the company's master funding conduit program in relation to its debt capitalization. It noted that the conduit's cross-collateralization features may limit STORE's financial flexibility in more stressed markets and give the issuer economic incentives to prioritize the encumbered asset pool.