NEW YORK (AP) — Fitch Ratings on Friday raised the credit rating outlook for Seagate Technology and its subsidiaries after the company turned in an improved first-quarter performance.
The ratings agency raised Seagate's rating to "Stable" from "Negative." It also affirmed the company's "BB" issuer default rating.
About $2.4 billion of debt is affected by Fitch's ratings action, including Seagate's $350 million secured revolving credit line.
Fitch said industry pricing has improved, contributing to higher profit margins at the company. Pricing stabilized after manufacturers cut capacity and demand improved.
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Fitch said Seagate's finances also got better, with operating profit more than doubling in the quarter from a year ago. It also reduced debt by $700 million in fiscal 2010.
Moreover, only $100 million in debt is coming due in 2010, which the company can handle. Seagate makes computer hard disk drives for data storage.
Shares of the Scotts Valley, Calif.-based company were down 19 cents to close at $15.73 Friday.