Let's compare the financials of two stocks: MBIA (MBI) which has Moody's top rating of Aaa and Pfizer (PFE) recently downgraded by Moody's to Aa1 and by Fitch to AA-Plus from AAA. Here are two recent downgrades of Pfizer.



December 12, 2007

Pfizer loses top "AAA" rating from Fitch



December 13, 2007

Pfizer's 900 mln eur new senior unsecured notes rated 'Aa1' - Moody's



Pfizer Financials







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MBIA Financials







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What is Moody’s rating scale?



Moody's Rating Scale runs from a high of Aaa to a low of C, and comprises 21 notches. It is divided into two sections, investment grade and speculative grade. The lowest investment grade rating is Baa3. The highest speculative-grade rating is Ba1.



Long-Term Debt Ratings (maturities of one year or more):



Investment Grade

Aaa – “gilt edged”

Aa1, Aa2, Aa3 – high-grade

A1, A2, A3 – upper-medium grade

Baa1, Baa2, Baa3 – medium grade



Speculative Grade

Ba1, Ba2, Ba3 – speculative elements

B1, B2, B3 – lack characteristics of a desirable investment

Caa1, Caa2, Caa3 – bonds of poor standing

Ca – highly speculative

C – lowest rating, extremely poor prospects of attaining any real investment standing



Compare Financials

Profit margin -61.76% vs. +17.07%

Return on Equity -35.54% vs. +12.13%

Revenue $3.12 Billion vs. $48.61 Billion

Earnings Per Share -$15.22 vs. +$1.20

Total Cash $5.73 Billion vs. $20.30 Billion

Total Debt $17.44 Billion vs. $8.69 Billion

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