Fitch affirmed Wyndham Worldwide Corp.'s issuer default rating at "BBB-" with a stable outlook.
The agency also affirmed Wyndham's senior unsecured credit facilities and senior unsecured notes at "BBB-". Fitch affirmed Wyndham's short-term IDR and senior unsecured commercial paper, and Wyndham Global Finance PLC's senior unsecured CP at "F3".
The ratings are reflective of the company's strong free cash flow profile as well as the management's publicly expressed commitment to maintaining low investment-grade credit metrics.
The rating agency outlined elevated leverage as its main concern for the "BBB-" category due to the company's exposure to the cyclical lodging and timeshare industries, as well as its increased contractual and contingent off-balance-sheet obligations.
The stable outlook reflects Fitch's expectation that Wyndham will operate within a target adjusted leverage of 3.25x with a firm cap at 3.5x.