Moody's affirms Illinois Tool Works rating

Moody's Investors Service on Friday affirmed the debt ratings of Illinois Tool Works Inc., saying the company managed to maintain margins despite the weak economy.

Moody's maintained its Aa3 investment grade debt ratings with a negative outlook.

On Thursday, the Glenview, Ill.-based equipment manufacturer posted second-quarter earnings of $528.1 million, or $1.01 per share, up 4 percent from the $505.6 million, or 90 cents per share, booked a year earlier.

Revenue rose 11 percent to $4.57 billion, from $4.14 billion in the prior-year period.

Moody's said its ratings anticipate some softening in earnings and margins due to the economy. The negative outlook reflects an expectation that the company will have to rely more heavily on short-term debt to fund acquisitions and to continue buying back shares.

Illinois Tool Works shares fell 26 cents to $46.74 in afternoon trading.