S&P Global Ratings took action this week, putting RXO on a negative outlook after previously upgrading C.H. Robinson’s debt rating to BBB+. The gap between the two companies is significant, with RXO’s BB rating lower than C.H. Robinson’s higher rating.

Moody’s and S&P Global have differing views on RXO, with Moody’s rating RXO higher than S&P Global. However, both companies have expressed concerns about RXO’s performance in the freight market.

RXO’s financial outlook is under pressure due to subdued freight demand, restructuring costs, and integration challenges from Coyote Logistics. S&P Global cited a low FFO to debt ratio at RXO, affecting the company’s credit rating and financial health.

Despite cost reductions and synergies from Coyote integration, RXO faces challenges in the truckload brokerage and automotive expedite-managed business. Regulatory crackdowns on drivers are also impacting RXO’s purchased transportation costs.

S&P Global does not anticipate a near-term improvement for RXO, with ongoing weak freight market conditions expected to persist. The ratings agency sees a possibility of lowering RXO’s rating within the next 12 months due to market challenges and cost pressures.

In contrast, C.H. Robinson’s financial performance has been stronger, with a higher FFO to debt ratio and positive earnings per share. The company’s stock has also shown growth compared to RXO’s decline.

Read more at Yahoo Finance: the growing financial divide widens some more