Moody's Investors Service upgraded Broad Institute to Aa3 from A1. The outlook was revised to stable at the new, higher rating from the previous positive.
The action affects $322 million of rated debt and Series A and Series B fixed-rate bonds issued through the Massachusetts Development Finance Agency.
Broad Institute, of Cambridge, Mass., spun off from Massachusetts Institute of Technology in 2009. The institute is an independent 501(c)(3) organization that emphasizes genomics-based scientific and biomedical research.
According to Moody's, the Broad had about $313 million of operating revenue in fiscal 2015.
The upgrade "reflects sustained growth of expendable financial resources and healthy operating cash flow to support high amount of debt," said Moody's.
Moody's said the institute's location and relationships with MIT, Harvard University and several local academic medical centers are competitive advantages that could position it for research growth and fundraising revenue.
"Successful completion of the new large research facility construction and ongoing fundraising success also support the Aa3 rating," Moody's added.
The stable outlook, said Moody's, reflects an expectation of ongoing good debt service coverage, on-time pledge payments and strong fundraising with no major capital plans on the horizon. Key credit challenges, according to the rating agency, include a competitive research funding environment.
