DEFINITION of 'Ratings Service'

A company, such as Moody's or Standard & Poor's, that rates various debt and preferred stock issues for safety of payment of principal, interest, or dividends.

BREAKING DOWN 'Ratings Service'

Ratings range from AAA or Aaa (the highest) to C or D, which represents a company that has already defaulted.

  1. Moody's

    An independent research company, through its subsidiaries Moody's ...
  2. Bond Rating Agencies

    Bond rating agencies are companies that assess the creditworthiness ...
  3. Preferred Dividend

    A dividend that is accrued and paid on a company's preferred ...
  4. Preferred Stock

    A class of ownership that has a higher claim on assets and earnings ...
  5. Debt Security

    A debt security is an instrument bought or sold between two parties ...
  6. Principal

    Principal is the amount borrowed on a loan or put into an investment.
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