What does the S & P rating mean?

I don't invest lots, but I have stock in Whole Foods. I read a story that said "Standard & Poor's on Tuesday cut its rating on Whole Foods Market... rating by one notch to "BB-plus," the highest junk rating, from "BBB-minus," the lowest investment-grade rating."

S&P (Standard & Poors) rates the ability of companies, municipalities and other organizations to repay their debt. The rating is attached to bonds used by the company or other organization to borrow money. An investment-grade rating basically means that institutional investors like pension funds and insurance companies might buy the bond. If a bond's rating falls below investment grade, these institutional investors are likely to sell, or not buy, the bond (some are required to avoid investing in junk bonds and sell the ones they have).

If you hold stock of a company and its bonds' ratings are lowered, that's a sign that the company will have a harder time paying the bonds. That, in turn, is likely to push the price of the stock down. A lowered rating doesn't necessarily mean the company will go down the tubes. Many junk rated companies survive and succeed. It's just that their chances of survival may be slimmer than more highly rated companies. Make sure you diversify your investments so that you have money invested in a variety of risks levels. Don't put everything into one or a few investments.

This rating is not for your stocks.
This rating is for Whole Foods' BONDS.

There are only two types:
1) Investment Grade
2) Junk

This is bad news for Whole Foods.

It's not wise to invest in Junk.