Moody's Boosts Boeing's Credit Rating

Posted 15 March 2006 @ 07:37 pm EET     Print     Reprint     E-Mail     Comments

NEW YORK (AP) - Moody's Investors Service on Wednesday raised its credit ratings on Boeing Co., citing the aerospace company's increased cash flow and recent focus on debt reduction.

The rating agency increased Boeing's long-term ratings one notch to "A2" to "A3," and affirmed Boeing's outlook as stable. The ratings were also applied to subsidiary Boeing Capital Corp.

"Both balance sheet debt and the company's underfunded pension obligations have declined in the past two years," Moody's analyst Michael Mulvaney said in a report. "Cash flow has increased due to growing margins in the company's defense segments and increased production and margins in the commercial aerospace segment."

The Chicago-based company reported in February fourth-quarter earnings more than doubled as its resurgent commercial airplane division posted strong gains. Boeing also raised its profit outlook for 2006, citing better operating performance.

Moody's noted that Boeing is "well positioned to internally fund capital spending, dividend payments, and diminished pension obligations as well as maturing debt without access to external sources of capital."

Shares of Boeing rose 35 cents to $75.80 in afternoon trading on the New York Stock Exchange.