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Moody's upgrades Group 1, cites improvements

NEW YORK (AP) -- Moody's Investors Service on Tuesday raised its corporate family and probability of default ratings for Group 1 Automotive Inc. to "Ba2" from "Ba3," citing the automotive retailer's improved finances and lower credit risk.

The rating is still in noninvestment or "junk" territory.

The outlook is stable.

The ratings service also noted that the uncertainty surrounding Toyota, which represents about 30 percent of Group 1's sales, has largely disappeared. Toyota had been rocked by vehicle recalls and supply shortages stemming from last year's earthquake and tsunami in Japan.

Meanwhile, Houston-based Group 1 continues to reduce its debt and keep its costs in check, resulting in increased profitability, Moody's said.

Group 1 shares fell 34 cents to $54 in afternoon trading.