Debt Downgrade Further Clouds Qwest's Outlook

Qwest (Q Quote) got another credit downgrade Tuesday, leaving its mountainous debt one notch from junk status and further complicating the Denver phone giant's financial picture.

News of the downgrade Tuesday afternoon immediately sent the stock plunging 5%, though Qwest shares traded above those levels later in the session. The stock, off 22 cents at $8.93 Tuesday afternoon, has lost more than three-quarters of its value in the last year.

Moody's Tuesday cut ratings affecting $28 billion of Qwest debt, citing concerns that the company wouldn't be able to "resolve substantial near-term debt maturities." Moody's also said it would leave its newly lowered ratings on review for an additional downgrade, which could further squeeze Qwest's cash position. ...