Moody's affirms Illinois Tool

Moody's Investors Service said it affirmed the Aa3 senior unsecured, long-term and P-1 short-term debt ratings of Illinois Tool Works Inc. following its announcement of an additional $3 billion open-ended share repurchase program and the earlier announced 33% dividend increase.

The agency said the affirmation reflects its expectation that unadjusted debt-to-capital could reach 20% to 25% by year-end.

The outlook is stable.

The Aa3/P-1 ratings reflect the company's diversification, earnings growth, strong operating margins, mounting free cash flow, solid liquidity and conservative financial philosophy, the agency said.

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