Moody's upgrades American Water

Moody's Investors Service said it upgraded American Water Works Co., Inc.’s issuer rating to A3 from Baa1, upgraded American Water Capital Corp.’s issuer rating to A3 from Baa1 and senior bonds to A3 from Baa1 and changed the outlook to stable from positive.

“American Water's rating upgrade reflects its improving financial profile, which we think is sustainable," Moody’s assistant vice president Ryan Wobbrock said in an agency news release. "With a ratio of FFO to net debt around 17% and regulated cash flow diversity across 16 states, we are collapsing the rating of American Water with the rating its largest operating subsidiaries.”

The agency said American Water Works’ A3 issuer rating reflects a strong financial profile, underpinned by low-risk water utilities that receive strong regulatory support and cost recovery provisions in most of its 16 state jurisdictions.

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