NEW YORK (CNN/Money) - No matter what the jury decides about Martha Stewart, the company she founded is on probation.

If the home decor maven is found guilty of any of the charges, Martha Stewart Living Omnimedia will probably have to do two things: discount current Martha Stewart branded products and move away from the Martha Stewart brand altogether -- a process that is already under way.

And if Stewart is acquitted? The company -- which is not accused of any wrongdoing of its own -- would still have some work in front of it to build up the brand and recover the lost revenue, advertisers, readers, and stock value that leaked away during the controversy. The effort to distance itself from the founder, or at least become less reliant, would likely continue.

"The company might decide to take away her leadership role, but having her there is still important," said Duncan Simester, professor of marketing at MIT's Sloan School of Management. "The situation would require a long-term plan. All might not be forgiven, but Martha is a survivor and she might come back stronger."

"On the other hand, losing her would be costly. She's been very good for the company before all this began. She could be vital to rebuilding the brand," Simester added.

Among those betting money on whether Stewart walks or gets jail time, the winds seem to be blowing in favor of a guilty verdict.

Through the trading of contracts on Irish-based Tradesports.com, participants place wagers on the chances of an event happening. A quick look at the Martha contracts shows that traders think there's more than a 50 percent chance the domestic diva will be found guilty on each of the charges she faces and goes to jail.

But Wall Street investors are a bit more optimistic, with the short interest activity on the stock having scaled down from peak levels late last year.

MSO spokeswoman Elizabeth Estroff declined to comment on the trial but said that the company has "done the necessary planning" and will "evaluate the circumstances and make decisions that are consistent with our existing management philosophy."

"We will continue to manage MSO for the long-term, investing to grow our core brand equity, while controlling costs," Estroff said.

"Martha in jail would be fairly disastrous for the company," said Henry Mazurek, a lawyer with the firm Gerald Shargel in New York. "She cannot remain on the board of directors as a convicted felon."

MIT's Simester agreed.

"This is a company and a brand that's tied to one person. A guilty verdict will further damage the business because people generally don't like to be associated with a person convicted of a crime," said Simester. "Can the brand survive? I think it will."

Robert Passikoff, a New York-based branding consultant, said he doesn't think consumers will ditch it altogether, but a negative verdict could change brand perception.

"Martha brought added value to the product. Consumers bought a 100 thread count sheet that was blessed by Martha. If you remove her name, the product still exists. Consumers may buy it but maybe won't pay the premium price for it," Passikoff said.

Maybe for Martha Stewart Omnimedia, survivability means weaning itself off the ubiquitous "Martha" label, especially if she's found guilty.

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Over the past year, the company launched a new magazine -- Everyday Food -- that doesn't feature her name prominently on the cover, and also a new TV show called "Pet Keeping with Marc Morrone" that excludes Martha entirely.

"The company has seen how tenuous it can be to be a hundred percent invested in one person," said Passikoff. Any sudden change in public perception of the 'human brand' has an immediate effect on the brand's equity, and soon after, its profitability."

New York-based Martha Stewart Living (MSO: Research, Estimates), which runs publishing, television and merchandising divisions, on Thursday reported a better-than-expected quarterly profit but warned that expects its founder's trial to hurt advertising revenue in current period. MSO also posted the company's first yearly loss since it went public in 1998.

Revenue from the publishing unit, which accounted for more than half of total sales in 2002, fell 26 percent in 2003 versus the year-earlier period. The company reduced the circulation guaranteed to advertisers of its flagship magazine -- Martha Stewart Living -- to 1.8 million from 2.3 million.

At the same time, some industry watchers say it's not fair to make Stewart a scapegoat for all of MSO's problems. "It's not just that the trial has taken a toll on the business. The company is coming out of the worst advertising slump in history and all publishing firms felt the impact, " said TK MacKay, analyst with Morningstar.

Analysts also see red flags with MSO's partnership with Kmart, the biggest distributor of Martha Stewart home products after the retailer recently filed a lawsuit alleging it was overcharged. Sales at MSO's merchandising unit fell rose 9.2 percent in 2003.

"The dispute supports our view that [the company's] current sweetheart deal with Kmart is likely to be dropped or significantly altered when the contract expires in Jan. 2008," Alissa Goldwasser, analyst with William Blair & Co. wrote in a recent research report.

Kmart (KMRT: Research, Estimates) spokeswoman Maria Seyrig declined to comment, saying that the company does not respond to speculation.

"If Martha goes to jail, this company will be hit but it won't fall apart," said Passikoff. "It could still compete in all the categories because it has a life of its own now and it's not as reliant upon Stewart to sustain financial viability. Sure, it will become a different company, with a different brand strategy, in need of a new leader."