Moody's rates Rockwell notes A3

Moody's Investors Service said it assigned an A3 rating to Rockwell Automation Inc.'s new unsecured notes.

The issuance does not impact other ratings of Rockwell, including the A3 senior unsecured or P-2 short-term ratings.

The outlook is stable.

The ratings reflect the company's strong market position and technological leadership in the high growth discrete automation sector, expectations for sustained EBITA margins of higher than 19% and free cash flows in excess of $600 million in 2019, Moody's said.

The company maintains moderate debt levels with debt-to-EBITDA ratio likely to remain in the low 2x range, the agency said.

Rockwell's growth strategy does not rely on large acquisitions, which will help to keep leverage close to current levels, Moody's said.

But the company is considered to be relatively small when compared to other industrial peers, the agency said.

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