Moody’s has placed Comcast’s debt ratings on review for a downgrade after the media conglomerate unveiled plans to separate into two independent publicly traded companies by spinning off the media and entertainment NBCUniversal unit, along with its European media business.

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“Comcast’s reduced revenue diversification following the planned public spin-off of NBCUniversal and Sky assets concentrates the remaining entity’s exposure to intensifying competition in broadband end markets,” Neil Mack, vp of corporate finance group at the credit ratings agency said in a statement on Tuesday.

Comcast, with its strategic pivot, aims to back away from a combination of content and pay-TV distribution under one roof just as its cable broadband business faces intensifying competition.

“The credit resilience of cable broadband business models remains under pressure due to debt leverage increasingly in conflict with negative operating trends, which is raising investor concerns about appropriate debt leverage tolerance levels in lower-growth end markets,” Mack added as he cited existing pressures on Comcast’s linear businesses. The credit ratings under review for downgrade previously had stable outlooks.

Now Moody’s is showing thumbs down to Comcast/NBCUniversal losing the synergies and cash flows from a combined presence in both content and traditional distribution just as Comcast with its planned separation opts for focus and investment, and potentially more dealmaking down the road, as keys to future success.

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“Persistent secular pressures in the company’s low margin linear video pay-TV business further elevate the importance of maintaining Comcast’s sizable broadband cash flow. Comcast also currently benefits from additional revenue diversity from its portfolio of media and studio content and theme parks, but these are lower margin businesses compared to the company’s broadband businesses, which in addition to residential broadband also includes the smaller but higher-margin business services connectivity segment,” Moody’s argued in its June 30 investors note.

Comcast’s linear cable TV networks were earlier spun off to shareholders as Versant Media Group. Moody’s argued Comcast’s debt levels will come under pressure without the EBITDA and cash flow tied to the declining, but high-margin businesses spun-off as Versant.

The post-spin NBCUniversal will be led by CEO Mike Cavanagh, and include NBC, Peacock, Bravo, Telemundo, the film and TV studios, the Universal theme parks business, and the company’s Sky division in Europe.

“While the company’s excellent liquidity and financial flexibility are supportive of the current credit profile, the negative secular pressures buffeting Comcast’s broadband-focused Connectivity and Platforms segment are heightening overall business risks,” the credit ratings agency said in explaining why Comcast was now at risk for a possible downgrade.

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