S&P places Lexmark on “CreditWatch”

A Standard & Poor's analyst said Thursday that Lexmark's credit rating could soon be downgraded.

Analyst Philip Schrank said the decision links to Lexmark's announcement this week that its fourth-quarter earnings will be lower than expected when announced later this month.

A Lexmark spokesman declined to comment.

S&P will meet with management before making a decision as to whether to lower its rating of BBB on Lexmark's senior unsecured debt.

S&P rates borrowers from a low of D to as high as AAA. Lower rating can mean paying higher interest rates on debt.

Lexmark's rating of BBB is the last rating above non-investment grade, commonly called junk bond status, though it could be downgraded to BBB- before falling to junk bond status.

If downgraded, Schrank said he expects the company's rating would fall no worse than one notch.