Fitch affirms Qwest rating; outlook stable

Fitch Ratings on Wednesday affirmed its issuer default rating for Quest Communications International Inc. and said its rating outlook for the company remains stable.

The issuer default rating of "BB" applies to $14.1 billion of the telecommunications company's debt, the ratings service said. A "BB" rating falls in the speculative category, indicating a higher level of credit risk.

Fitch said in a statement that it believes Qwest can withstand competitive pressure and economic factors to maintain the rating.

But compared with regional bell operating companies, which include AT&T Inc. and Verizon Communications Inc., Qwest lacks revenue diversity, Fitch said. Qwest relies on its land-line business, which is more vulnerable to the economic downturn because fewer new houses are built, while competitors have growing wireless businesses.

The stable outlook reflects Fitch's expectation that Qwest's efforts to bundle and sell services, and its investment in high-speed data, will preserve the company's profitability as other business segments decline.

Fitch also said Qwest's cash position and overall financial flexibility are strong, helped by a new $1.04 billion revolving credit facility announced earlier this week.

Shares of Qwest slipped a penny to $4.28 in afternoon trading.