Moody’s rates Starbucks notes A2

Moody's Investors Service said it assigned an A2 rating to Starbucks Corp.’s proposed $750 million senior unsecured note offering.

Moody's ratings for Starbucks also include its A2 senior unsecured rating and Prime-1 short-term commercial paper rating.

The outlook is stable.

"The rating assignment reflects Starbucks solid credit metrics and liquidity as well as Moody's view that the company's measured growth strategy, product pipeline, digital initiatives and balanced financial policy will continue to drive strong operating earnings, credit metrics, liquidity and greater scale over time," Moody's senior credit officer Bill Fahy said in a news release.

To date, Starbucks various product offerings and digital initiatives have driven strong operating metrics and earnings.

As of the LTM period ending March 27, and pro forma for the proposed $750 million note offering debt to EBITDA will be roughly 1.75 times and EBIT to interest will be around 12.6 times, the agency said.

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