The rating on Beverly Hills, Calif.-based Live Nation reflects financial risk from a high lease-adjusted debt to EBITDA ratio; EBITDA levels subject to general economic trends, talent costs, and the success of concert schedules; volatile attendance trends; and limited potential for margin expansion. These factors are partially offset by the company's strong competitive position in the live-entertainment industry, its significant geographic and format diversity, and historically positive discretionary cash flow. Business risk is a key rating concern. The live-entertainment industry is an artist-driven business and is highly sensitive to shifting public tastes, levels of consumer and corporate discretionary spending, touring schedules, and the potential for lower attendance at amphitheaters because of weather conditions. Since its spin-off from Clear Channel Communications
