Moody's upgrades Peabody

Moody's Investors Service said it upgraded Peabody Energy Corp.'s corporate family rating to Ba1 from Ba2 and senior unsecured ratings to Ba2 from Ba3. The outlook is stable.

The agency said the upgrade recognizes the significant improvement in Peabody's operating performance, cash flow and debt protection measurements over the past three years and Moody's view that Peabody is positioned to sustain strong operating results and cash flow, which should enable the company to finance organic growth through internally generated funds and continue to generate positive free cash flow.

The stable outlook reflects the stable nature of Peabody's business and cash flow, which Moody's attributed to the company's diverse coal operations, vast reserves, long-term sales contracts and coal's importance as a fuel for electricity generation.

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