Tenet’s Debt Lowered to Junk by Moody’s

Tenet Healthcare Corp.’s debt was cut to junk, or below investment grade, by Moody’s Investors Service after the U.S. hospital chain reduced profit forecasts for the third time since November.

Moody’s cut its rating on Tenet’s senior unsecured debt three levels to Ba3 from Baa3, the lowest investment grade, and said the rating may be reduced further.

Lower ratings raise borrowing expenses because investors consider the debt more risky. Santa Barbara-based Tenet, whose Medicare billing is being probed by the U.S., said this week that second-quarter and full-year profit would be lower than forecast.

Shares of Tenet fell 5 cents to $11.95 on the NYSE.