Microsoft Scores AAA Rating From S&P (MSFT)

Standard & Poor’s has just made what appears to be its first new "AAA" corporate credit rating in years.  The winner is none other than Microsoft Corp. (NASDAQ: MSFT).  Its short-term and commercial paper ratings were also given "A-1+" ratings.  It has also awarded its "AAA" rating a stable outlook.

This might not have been anything more than noise just a few yearsago.  But in a world where stable cash flows and stable finances areeverything, the software giant may have just won a score.  S&P calls its portfolio vertically integrated and diverse with numerousleadership positions and a minimal financial risk over manygeographies.  It also cited strong barriers to entry despite technologyhaving many other risks.

S&P further added, "…Microsoft will maintain the technical,managerial, and financial wherewithal to adapt to industry transitionsas successfully as it has in the past…"

As far as addressing mergers, S&P believes that Microsoft will havevery few large acquisition possibilities from a regulatory stancebecause of its dominance in so many areas.

Jon C. Ogg
September 22, 2008