CHICAGO-- Moody's Investors Service revised its outlook on Ohio-based Kenyon College's A1 rating to stable from negative Dec. 12 as the school's stronger performance in fiscal 2014 is expected to continue.
The action impacts $189 million of rated debt sold through the Ohio Higher Educational Facility Commission. Analysts said they expect that cash flow will remain highly positive and that the growth in financial resources will outpace peers."
The current rating reflects Kenyon College's robust student demand despite strong competition with other selective colleges that are able to charge lower net tuition per student due to larger endowments. The college's positive operating performance, healthy flexible reserves, and consistent ability to fundraise also support the rating, Moody's said.
The school's challenges include significant balance sheet leverage, debt structure consisting of bullet maturities, and an aggressive investment allocation.
Kenyon is a selective private liberal arts college with tuition of $31,655 and strengthening selectivity in fall 2014 to 25% of its growing pool of fall applicants. Gift revenue was healthy with three-year average gifts per student of $8.9 million in FY 2014.
"We expect fundraising to strengthen since the college is planning a comprehensive campaign," Moody's added.
