Which of the following two companies will have a higher bond rating:
Abbott Laboratories Inc (ticker: U:ABT) or Bristol Myers Squibb Company (U:BMY)?
Bond rating agencies, such as Moody's, Standard and Poor's, and Fitch, investigate, among other things, a company's debt and profitability ratios (see Chapter 2 for these ratios) to rate its bonds.
Examine these ratios for the two companies and explain which company's bonds are likely to have a higher rating and why.
Since these exercises depend upon real-time data, your answers will change continuously depending upon when your access the Internet to download your data.