...The ratings on Cendant Corp. reflect the company's solid position in residential real estate and auto rental, and its relatively good position in hospitality and travel distribution. Ratings also reflect the ownership of many well-regarded brands and Cendant's historical ability to generate significant discretionary cash flow. These factors are tempered by the company's exposure to the travel and leisure and residential real estate industries, which may be affected by cyclical economic trends or geopolitical events, and a historically aggressive growth strategy. On Oct. 12, 2004, Cendant announced that it will spin off the mortgage and fleet operations of its subsidiary PHH Corp. to Cendant shareholders, and that this will occur by February 2005. Standard & Poor's has historically considered the risk profiles of Cendant and PHH separately. This treatment has underscored the view that PHH was managed and financed separately from its parent, and that sufficient firewalls have existed to prevent...
