Two Questions for Jarden's 2008 Year End

Broad macro pressures have finally caught up to Jarden Corp. ((JAH) or the "Company") in recent months and that combination, along with a considerable debt load, is presenting a rather toxic atmosphere for the Company, its investors, and its lenders in 2009. While various risk aspects of JAH have been covered in previous posts, there are two items that should be considered ahead of its Q4 08 earnings release - JAH's credit rating and the value of its Goodwill and Intangible Assets.

In December 2008, Moody's lowered its rating outlook for the Company, citing JAH's 2009 revenue guidance. What's surprising is that Moody's has not reduced its outlook from stable to negative given the headwinds facing the Company and its difficult leverage position. During JAH's Q3 08 conference call, CEO Martin Franklin stated that he expected that the Company's leverage ratio would decline from 3.6x as of Q3 08 to under 3.5x by year-end 2008. Instead, in December, the Company released a warning stating that its leverage ratio would be roughly 3.7x as of Q4 08.