S&P Global Ratings downgraded TTM Technologies Inc.’s outlook to stable from positive and affirmed the company’s ‘BB’ issuer credit rating after it announced plans to acquire Epiq Solutions for $1.1 billion.
The acquisition, expected to close in the fourth quarter of 2026, marks TTM’s third deal in recent months following a period of limited M&A activity. The financing will be debt-driven, pushing pro forma leverage to the high-2x area in 2026 from a low-1x range in 2025, according to S&P.
S&P warned that additional debt-funded acquisitions or weaker end-market demand could sustain leverage above 3x, prompting a potential downgrade. Conversely, a rating upgrade would require sustained adjusted net leverage below 2x, free operating cash flow to debt of around 15%, and organic revenue growth in key end markets.
TTM’s growth outlook remains tied to AI data center demand and heavy customer infrastructure investments in advanced printed circuit boards. The company projects nearly 50% revenue growth in 2026, followed by mid-teens percent growth in 2027.
Cash flow is expected to remain constrained in 2026 due to growth investments and elevated working-capital needs, with free operating cash flow turning modestly negative. Capital expenditures are projected to exceed $370 million. By 2027, improved EBITDA margins near 20% are anticipated to generate more than $250 million in free operating cash flow.
