PepsiCo's senior long-term debt rating has been raised by Moody's. The investors' service upped its rating on the soft-drink maker to "Aa3" from "A1." Moody's cited Pepsi's improved financial performance and balance sheet.

The upgrade is Moody's fourth highest, putting PepsiCo's long-term debt at the same level as that of Coca Cola Co. Moody's affirmed PepsiCo's "Prime 1" short-term debt rating, and said the company's outlook is "stable."

Moody's believes PepsiCo will probably continue to use free cash flow to fund about US$2 billion of share buybacks per year.