From C to Shining C, Refreshing our Scorecard Framework

Research evidence excerpt

From C to Shining C, Refreshing our Scorecard Framework

Idea

July 6, 2026 07:54 AM GMT

Morgan Stanley & Co. LLCMRetail Credit Research | North America Jenna L Giannelli

Credit analyst

From C to Shining C, Refreshing Jenna.Giannelli@morganstanley.comRoopi Bhangu +1 212 761-4340

Credit Analyst

Roopi.Bhangu@morganstanley.com +1 212 761-1912

our Scorecard Framework

We extend our original 5Cs to 10Cs, expanding the factors most

relevant to issuer quality and trajectory. For the companies

within our credit universe, we assign a composite score across

the ten factors and plot it against spread compensation,

providing a cleaner basis for relative value analysis.

Key Takeaways

Our ten-factor scorecard assesses the company's brand, scale, category, and

channel positioning, plus earnings outlook, credit profile, asset value, and event

risk.

SPLS and MIK screen as the clearest cheap/wide names vs. the trendline, though

the spread premium reflects meaningful credit and execution risk. Among weaker

credit profiles, RH, WOOF, and KSS screen as fair to tight relative to their

composite scores.

W and BBWI screen just above the line (both are comfortably above if we

exclude SPLS), offering attractive compensation relative to their scorecard

positioning and issuer-specific caveats.

LEVI is the cleanest credit on the scorecard, and its levels are broadly supported.

SBH, VSXY, VFC, GAP, and M screen somewhat rich/tight vs. the trendline, with

spreads below score-implied levels and less obvious cushion.

CROX, WWW, CRI, and UAA screen rich/tight vs. score-implied OAS, leaving less

spread cushion for idiosyncratic risk.

Note: This is a screening tool, not a standalone valuation or recommendation

framework. Wider OAS may represent excess compensation, but it may also reflect