New York, March 16, 2015 -- The most common predictors of future financial distress are weak credit metrics (excessive leverage and weak interest coverage), poor operating performance, weak liquidity, declining sales and weak industry fundamentals. These characteristics are among 10 credit issues that can surface prior to default which Moody's Investors Service illustrates as it looks at a random sample of 10 small, speculative-grade companies that have defaulted since 2009. While not universal, a majority of the sample companies generated negative free cash flow three to 15 months prior to default.

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