While the US runs the risk of losing its top-notch triple-A credit ratings after a long, bruising battle over its debt ceiling, a number of multinational companies look set to benefit from higher ratings than their sovereigns.

Usually the sovereign — the government — is seen as the most solvent entity in the country given its huge cash pile from tax receipts and international reserves and its ability to generate cash by selling state-owned assets.

But today a number of governments face bigger risks of downgrades or defaults than private-sector firms as finances in developed economies deteriorate in the wake of the credit crisis.

In contrast, companies, especially those generating revenue in the emerging world, are enjoying high levels of cash flows.

“Since 2008 a large number of multinationals have deleveraged and increased cash in the balance sheets, so you end up with an upgrade cycle. This is leading to some companies rated better than the state,” said Ashok Shah, chief investment officer of London & Capital.

“More and more companies will fall into this category.”

Globally, 107 corporate and local governments have higher ratings than those of the sovereign in their country of domicile on a foreign currency basis, Standard & Poor’s says. That means these entities are seen as likely to be able to cover their debt obligations even when the central government of the country they are based in cannot.

“Balance sheets of OECD countries will continue to deteriorate. You’re looking at a medium to long-term credit downgrade cycle over the next five years,” said Shah.

In some cases, it also costs investors less to insure the debt of safe-haven companies — defensive, non-cyclical stocks with high free cash flow and low leverage — against default than the debt of their sovereigns, adding to their appeal.

In the US, Automatic Data Processing, Exxon Mobil, Johnson & Johnson and Microsoft all boast triple-A ratings.

S&P has said that a change in the US sovereign credit rating or outlook will not affect these four corporates.

The cost of insuring the four companies’ debt against default on a five-year horizon is at least 20 basis points lower than that of the US government.

Elsewhere, Spain’s local autonomous Basque and Navarre governments and Japan’s Canon are among those entities that have higher ratings than their respective sovereigns.

Emerging market companies should also benefit given low levels of debt and strong growth. Turkish mobile operator Turkcell, which has been expanding in Ukraine and Belarus, is rated above Turkey. Brazil’s beverage company AmBev AMB.N has just got upgraded to A-minus, above the sovereign.

“I believe a diversified exposure to a large number of companies remains a better bet than concentrated exposure to sovereigns with a questionable ability to reduce their leverage over the long term,” said Chris Iggo, chief investment officer of fixed income at AXA Investment Managers.

The shift may be already under way. In the week to July 27, US money market funds — which primarily invest in Treasuries — lost $32 billion (19.6 billion pounds), according to mutual funds data from Lipper, while high yield and investment grade bond funds attracted a combined $482 million.

But while inflows will be helpful, the corporate bond market lacks the depth and liquidity of the sovereign debt market.

The US corporate bond sector, for example, is estimated at less than half of the Treasury market, which has around $10 trillion of tradable bonds.

Corporate debt issuance could also rebound more quickly toward 2012 if the global economy regains its momentum and companies decide to increase their leverage.

During the Asian crisis in the late 1990s, some companies in Indonesia and Japan saw their ratings boosted above those of their sovereigns, illustrating the scale of corporate sector resilience in times of a sovereign crisis.

Diverging macro- and micro-economic fundamentals are evident in Britain and the United States, where companies on benchmark indexes generate huge revenues overseas — some 70 percent and 30 percent, respectively.

Goldman Sachs also estimates that S&P 500 companies’ .SPX sales growth is more highly correlated with export growth than top-line gross domestic product growth.

For big firms, financing conditions are improving greatly. The spread between the yield on a loan of less than $100,000 and a loan of more than $10 million has widened to 240 basis points from 185 bps in 2007, meaning large loans are getting cheaper.

Companies with a CDS spread below that of Group of Seven sovereigns, yet offering dividend yields above government bond yields, make up what Credit Suisse calls “ultra-safe” equities.

This group includes Centrica, Sanofi, Novartis and Merck.

“If there was a default, we would simply focus on non-cyclical companies with high free cash flow yield and low leverage, as we assume that funding markets would dry up and the cost of debt would rise,” Credit Suisse said in a note.