NEW YORK -- Moody's Investors Service raised the senior unsecured ratings of Reynolds American Inc. on Tuesday, on expectations that the tobacco company's profits will continue to improve.
Earlier in the day the maker of Camel, Pall Mall and Natural American Spirit brand cigarettes reported that its third-quarter profit climbed nearly 7 percent as higher prices and smokeless tobacco gains helped offset a decline in the number of cigarettes it sold.
Moody's increased the senior unsecured ratings of Reynolds American and subsidiary R.J. Reynolds Tobacco Holdings one notch in investment grade status to "Baa2" from "Baa3."
The company's outlook is stable.
Shares of Reynolds American fell 79 cents, 1.8 percent, to $41.72 in afternoon trading. The stock has traded in a range of $37.68 to $46.93 over the past year.