Moody's Pares Outlook On Kraft

Moody's Investors Service reduced its outlook on Kraft (NYSE: KFT) to "negative" from "stable" on concerns the Dow component will not be quickly reduce its financial leverage in the wake of the company's $19.5 billion purchase of Cadbury (NYSE: CBY).

Moody's confirmed its Baa2 long-term rating on Kraft, but said if the company starts repurchasing shares or explores another acquisition, a downgrade would be likely. Kraft needs a more disciplined and conservative financial stance over the next two years to keep that rating, Moody's said.