Moody's upgrades AB Volvo

Moody's said it upgraded AB Volvo's long-term issuer rating to A3 from Baa1 and affirmed the Prime-2 (P-2) short term issuer rating.

The outlook on all entities was changed to stable from positive.

“The upgrade to A3 reflects the continuous improvements in Volvo's financial performance and credit metrics, which Moody's expects as sustainable even in periods of weaker demand for its products,” said Daniel Harlid, lead analyst for AB Volvo, in a news release.

“Profitability improvements driven by growing sales while maintaining cost discipline and free cash flow generation applied to debt reduction have supported an improvement in credit metrics, as reflected in today's rating action.”

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