Simple Bankruptcy Prediction (Altman Z Doesn't Work)
Updated: 6 days ago
A simple ratio involving only stock-market capitalization and the face value of debt is a strong bankruptcy predictor when applied to firms with negative one-year returns. The ratio is interpretable as the minimum price at which a firm's debt must trade if the firm is solvent.
Download the full white paper:
Simple Bankruptcy Prediction
.pdf
Download PDF • 149KB