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Say Versus Do: Analysis of Fitch Ratings and Bond Grades for a Regional Airport

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  • Stephen A. LeMay
  • Kalee Burns
  • Richard R. Hawkins

Abstract

In this short article, we examine the airport bond rating system by Fitch Ratings, including what Fitch documents “say” are important versus the level of analysis that is actually “done.” One thing that is apparently not done is construction of a travel model for measuring competition between airports. We do this for the Pensacola, Florida, airport. Results indicate the Fort Walton Beach facility is the largest threat and the staff at Fitch Ratings have, to some degree, focused on the wrong airport. We also found that, while ratings affect interest rates, the relationship to risk is less clear.

Suggested Citation

  • Stephen A. LeMay & Kalee Burns & Richard R. Hawkins, 2016. "Say Versus Do: Analysis of Fitch Ratings and Bond Grades for a Regional Airport," Transportation Journal, John Wiley & Sons, vol. 55(3), pages 315-329, July.
    • Handle: RePEc:wly:transj:v:55:y:2016:i:3:p:315-329
    DOI: 10.5325/transportationj.55.3.0315
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    References listed on IDEAS

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    1. Lawrence J. White, 2010. "Markets: The Credit Rating Agencies," Journal of Economic Perspectives, American Economic Association, vol. 24(2), pages 211-226, Spring.
    2. Liping Zheng, 2012. "Are Sovereign Credit Ratings Objective? A Tale of Two Agencies," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 2(5), pages 1-3.
    3. Cohas, François J & Belobaba, Peter P & Simpson, Robert W, 1995. "Competitive fare and frequency effects in airport market share modeling," Journal of Air Transport Management, Elsevier, vol. 2(1), pages 33-45.
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