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Published on 9/26/2013 in the Prospect News Investment Grade Daily.

Fitch rates Wal-Mart notes AA

Fitch Ratings said it assigned a rating of AA to Wal-Mart Stores, Inc.'s $1 billion issue of five-year notes and $750 million of 30-year notes.

Wal-Mart has a long-term issuer default rating of AA, senior unsecured debt rating of AA, bank credit facility rating of AA, short-term issuer default rating of F1+ and commercial-paper rating of F1+.

The outlook is stable.

The proceeds will be used for general corporate purposes.

The ratings reflect Walmart's dominant market position in North America, strong position in the United Kingdom and growing presence in other markets such as China, Brazil, Central America and South Africa, Fitch said.

Also considered is Walmart's low cyclicality, consistent free cash flow and steady financial leverage despite ongoing debt-financed share repurchases, the agency said.

These factors are balanced by a more challenging economic environment pressuring the company's core customer base, Fitch said, and growing competition from dollar stores and hard discounters.


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