How to assess the susceptibility of a U.S. company to go bankrupt?












4












$begingroup$


Suppose a NASDAQ equity XYZ.



Question :




  • How can we assess the susceptibility of a company to go bankrupt? Are there good criteria that we can trust? What about the Buffett indicator?


  • How to evaluate the viability of a company on the stock market?







nasdaq







share|improve this question











$endgroup$








  • 1




    $begingroup$
    Forecasting Bankruptcy More Accurately: A Simple Hazard Model: pdf: www-personal.umich.edu/~shumway/papers.dir/forcbank.pdf
    $endgroup$
    – Emma
    18 hours ago
















4












$begingroup$


Suppose a NASDAQ equity XYZ.



Question :




  • How can we assess the susceptibility of a company to go bankrupt? Are there good criteria that we can trust? What about the Buffett indicator?


  • How to evaluate the viability of a company on the stock market?







nasdaq







share|improve this question











$endgroup$








  • 1




    $begingroup$
    Forecasting Bankruptcy More Accurately: A Simple Hazard Model: pdf: www-personal.umich.edu/~shumway/papers.dir/forcbank.pdf
    $endgroup$
    – Emma
    18 hours ago














4












4








4


1



$begingroup$


Suppose a NASDAQ equity XYZ.



Question :




  • How can we assess the susceptibility of a company to go bankrupt? Are there good criteria that we can trust? What about the Buffett indicator?


  • How to evaluate the viability of a company on the stock market?







nasdaq







share|improve this question











$endgroup$




Suppose a NASDAQ equity XYZ.



Question :




  • How can we assess the susceptibility of a company to go bankrupt? Are there good criteria that we can trust? What about the Buffett indicator?


  • How to evaluate the viability of a company on the stock market?







nasdaq




nasdaq






share|improve this question















share|improve this question













share|improve this question




share|improve this question








edited 17 hours ago









Emma

2419




2419










asked 18 hours ago









fgauthfgauth

526




526








  • 1




    $begingroup$
    Forecasting Bankruptcy More Accurately: A Simple Hazard Model: pdf: www-personal.umich.edu/~shumway/papers.dir/forcbank.pdf
    $endgroup$
    – Emma
    18 hours ago














  • 1




    $begingroup$
    Forecasting Bankruptcy More Accurately: A Simple Hazard Model: pdf: www-personal.umich.edu/~shumway/papers.dir/forcbank.pdf
    $endgroup$
    – Emma
    18 hours ago








1




1




$begingroup$
Forecasting Bankruptcy More Accurately: A Simple Hazard Model: pdf: www-personal.umich.edu/~shumway/papers.dir/forcbank.pdf
$endgroup$
– Emma
18 hours ago




$begingroup$
Forecasting Bankruptcy More Accurately: A Simple Hazard Model: pdf: www-personal.umich.edu/~shumway/papers.dir/forcbank.pdf
$endgroup$
– Emma
18 hours ago










2 Answers
2






active

oldest

votes


















5












$begingroup$

I have been told:



Bankruptcy is so very controversial.



You might track companies ratios (e.g., debt to equity ratio, EPS, net income, cash per share (cash/sh), etc.). For instance, GE looks almost bankrupt. But, it is not and there is a very low probability that GE would file for any bankruptcy chapter, I'm just guessing.



There are many companies, especially in OTC markets, that many investors consider them "bankrupt", but "they are not" and their equities are being traded, e.g. OTCMKTS: HMNY. Usually, theses companies are destined to takeover, involuntary M&As, and so.



Also, there are types of bankruptcies that you might take into account, not to mention the complexity of U.S. bankruptcy courts, when it comes to public firms Wikipedia. Majorities of top public companies are incorporated in Delaware, which has a fairly advanced court system to protect shareholders (e.g., Delaware Court of Chancery).



Companies in pharmaceutical sector might be good to look into since they usually develop high-risk products that may not succeed. You may use stock screener tools to filter companies based on any criteria you wish and find those that are in serious financial situations. In fact, many small-account retail traders love to trade their equities, since they are usually oversold Finviz Oversold TradingView.




My favorites screeners are:



Finviz



TradingView



Also, you may collect grading data from so many equity research websites Wikipedia. Such as:



Seeking Alpha



Zacks.com



Barron's



Thomson Reuters



GE Finviz



GE on Finviz






share|improve this answer










New contributor




Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.






$endgroup$









  • 1




    $begingroup$
    Is cash flow from ops anywhere on that sheet? I might be going blind, but if it isn't there - I'd say it is fairly important. You can run at a loss on balance, but still be bringing in cash by the bucketful. Cash is king.
    $endgroup$
    – Stian Yttervik
    8 hours ago






  • 1




    $begingroup$
    @StianYttervik Right! There is: cash/sh (cash per share)!
    $endgroup$
    – Emma
    7 hours ago



















7












$begingroup$

Since the stock is listed on NASDAQ, you have access to fairly standard 10Q and 10K financial statements. So you can apply the analysis pioneered by Ed Altman in his Z-score paper - compare this company's fundamental ratios with those of other companies, and see how many of them went bankrupt historically. For example, Moody's KMV uses this approach to estimate "EDF" (expected default frequency) for many corporate credits.






share|improve this answer









$endgroup$













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    2 Answers
    2






    active

    oldest

    votes








    2 Answers
    2






    active

    oldest

    votes









    active

    oldest

    votes






    active

    oldest

    votes









    5












    $begingroup$

    I have been told:



    Bankruptcy is so very controversial.



    You might track companies ratios (e.g., debt to equity ratio, EPS, net income, cash per share (cash/sh), etc.). For instance, GE looks almost bankrupt. But, it is not and there is a very low probability that GE would file for any bankruptcy chapter, I'm just guessing.



    There are many companies, especially in OTC markets, that many investors consider them "bankrupt", but "they are not" and their equities are being traded, e.g. OTCMKTS: HMNY. Usually, theses companies are destined to takeover, involuntary M&As, and so.



    Also, there are types of bankruptcies that you might take into account, not to mention the complexity of U.S. bankruptcy courts, when it comes to public firms Wikipedia. Majorities of top public companies are incorporated in Delaware, which has a fairly advanced court system to protect shareholders (e.g., Delaware Court of Chancery).



    Companies in pharmaceutical sector might be good to look into since they usually develop high-risk products that may not succeed. You may use stock screener tools to filter companies based on any criteria you wish and find those that are in serious financial situations. In fact, many small-account retail traders love to trade their equities, since they are usually oversold Finviz Oversold TradingView.




    My favorites screeners are:



    Finviz



    TradingView



    Also, you may collect grading data from so many equity research websites Wikipedia. Such as:



    Seeking Alpha



    Zacks.com



    Barron's



    Thomson Reuters



    GE Finviz



    GE on Finviz






    share|improve this answer










    New contributor




    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.






    $endgroup$









    • 1




      $begingroup$
      Is cash flow from ops anywhere on that sheet? I might be going blind, but if it isn't there - I'd say it is fairly important. You can run at a loss on balance, but still be bringing in cash by the bucketful. Cash is king.
      $endgroup$
      – Stian Yttervik
      8 hours ago






    • 1




      $begingroup$
      @StianYttervik Right! There is: cash/sh (cash per share)!
      $endgroup$
      – Emma
      7 hours ago
















    5












    $begingroup$

    I have been told:



    Bankruptcy is so very controversial.



    You might track companies ratios (e.g., debt to equity ratio, EPS, net income, cash per share (cash/sh), etc.). For instance, GE looks almost bankrupt. But, it is not and there is a very low probability that GE would file for any bankruptcy chapter, I'm just guessing.



    There are many companies, especially in OTC markets, that many investors consider them "bankrupt", but "they are not" and their equities are being traded, e.g. OTCMKTS: HMNY. Usually, theses companies are destined to takeover, involuntary M&As, and so.



    Also, there are types of bankruptcies that you might take into account, not to mention the complexity of U.S. bankruptcy courts, when it comes to public firms Wikipedia. Majorities of top public companies are incorporated in Delaware, which has a fairly advanced court system to protect shareholders (e.g., Delaware Court of Chancery).



    Companies in pharmaceutical sector might be good to look into since they usually develop high-risk products that may not succeed. You may use stock screener tools to filter companies based on any criteria you wish and find those that are in serious financial situations. In fact, many small-account retail traders love to trade their equities, since they are usually oversold Finviz Oversold TradingView.




    My favorites screeners are:



    Finviz



    TradingView



    Also, you may collect grading data from so many equity research websites Wikipedia. Such as:



    Seeking Alpha



    Zacks.com



    Barron's



    Thomson Reuters



    GE Finviz



    GE on Finviz






    share|improve this answer










    New contributor




    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.






    $endgroup$









    • 1




      $begingroup$
      Is cash flow from ops anywhere on that sheet? I might be going blind, but if it isn't there - I'd say it is fairly important. You can run at a loss on balance, but still be bringing in cash by the bucketful. Cash is king.
      $endgroup$
      – Stian Yttervik
      8 hours ago






    • 1




      $begingroup$
      @StianYttervik Right! There is: cash/sh (cash per share)!
      $endgroup$
      – Emma
      7 hours ago














    5












    5








    5





    $begingroup$

    I have been told:



    Bankruptcy is so very controversial.



    You might track companies ratios (e.g., debt to equity ratio, EPS, net income, cash per share (cash/sh), etc.). For instance, GE looks almost bankrupt. But, it is not and there is a very low probability that GE would file for any bankruptcy chapter, I'm just guessing.



    There are many companies, especially in OTC markets, that many investors consider them "bankrupt", but "they are not" and their equities are being traded, e.g. OTCMKTS: HMNY. Usually, theses companies are destined to takeover, involuntary M&As, and so.



    Also, there are types of bankruptcies that you might take into account, not to mention the complexity of U.S. bankruptcy courts, when it comes to public firms Wikipedia. Majorities of top public companies are incorporated in Delaware, which has a fairly advanced court system to protect shareholders (e.g., Delaware Court of Chancery).



    Companies in pharmaceutical sector might be good to look into since they usually develop high-risk products that may not succeed. You may use stock screener tools to filter companies based on any criteria you wish and find those that are in serious financial situations. In fact, many small-account retail traders love to trade their equities, since they are usually oversold Finviz Oversold TradingView.




    My favorites screeners are:



    Finviz



    TradingView



    Also, you may collect grading data from so many equity research websites Wikipedia. Such as:



    Seeking Alpha



    Zacks.com



    Barron's



    Thomson Reuters



    GE Finviz



    GE on Finviz






    share|improve this answer










    New contributor




    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.






    $endgroup$



    I have been told:



    Bankruptcy is so very controversial.



    You might track companies ratios (e.g., debt to equity ratio, EPS, net income, cash per share (cash/sh), etc.). For instance, GE looks almost bankrupt. But, it is not and there is a very low probability that GE would file for any bankruptcy chapter, I'm just guessing.



    There are many companies, especially in OTC markets, that many investors consider them "bankrupt", but "they are not" and their equities are being traded, e.g. OTCMKTS: HMNY. Usually, theses companies are destined to takeover, involuntary M&As, and so.



    Also, there are types of bankruptcies that you might take into account, not to mention the complexity of U.S. bankruptcy courts, when it comes to public firms Wikipedia. Majorities of top public companies are incorporated in Delaware, which has a fairly advanced court system to protect shareholders (e.g., Delaware Court of Chancery).



    Companies in pharmaceutical sector might be good to look into since they usually develop high-risk products that may not succeed. You may use stock screener tools to filter companies based on any criteria you wish and find those that are in serious financial situations. In fact, many small-account retail traders love to trade their equities, since they are usually oversold Finviz Oversold TradingView.




    My favorites screeners are:



    Finviz



    TradingView



    Also, you may collect grading data from so many equity research websites Wikipedia. Such as:



    Seeking Alpha



    Zacks.com



    Barron's



    Thomson Reuters



    GE Finviz



    GE on Finviz







    share|improve this answer










    New contributor




    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.









    share|improve this answer



    share|improve this answer








    edited 2 hours ago





















    New contributor




    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.









    answered 17 hours ago









    EmmaEmma

    2419




    2419




    New contributor




    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.





    New contributor





    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.






    Emma is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
    Check out our Code of Conduct.








    • 1




      $begingroup$
      Is cash flow from ops anywhere on that sheet? I might be going blind, but if it isn't there - I'd say it is fairly important. You can run at a loss on balance, but still be bringing in cash by the bucketful. Cash is king.
      $endgroup$
      – Stian Yttervik
      8 hours ago






    • 1




      $begingroup$
      @StianYttervik Right! There is: cash/sh (cash per share)!
      $endgroup$
      – Emma
      7 hours ago














    • 1




      $begingroup$
      Is cash flow from ops anywhere on that sheet? I might be going blind, but if it isn't there - I'd say it is fairly important. You can run at a loss on balance, but still be bringing in cash by the bucketful. Cash is king.
      $endgroup$
      – Stian Yttervik
      8 hours ago






    • 1




      $begingroup$
      @StianYttervik Right! There is: cash/sh (cash per share)!
      $endgroup$
      – Emma
      7 hours ago








    1




    1




    $begingroup$
    Is cash flow from ops anywhere on that sheet? I might be going blind, but if it isn't there - I'd say it is fairly important. You can run at a loss on balance, but still be bringing in cash by the bucketful. Cash is king.
    $endgroup$
    – Stian Yttervik
    8 hours ago




    $begingroup$
    Is cash flow from ops anywhere on that sheet? I might be going blind, but if it isn't there - I'd say it is fairly important. You can run at a loss on balance, but still be bringing in cash by the bucketful. Cash is king.
    $endgroup$
    – Stian Yttervik
    8 hours ago




    1




    1




    $begingroup$
    @StianYttervik Right! There is: cash/sh (cash per share)!
    $endgroup$
    – Emma
    7 hours ago




    $begingroup$
    @StianYttervik Right! There is: cash/sh (cash per share)!
    $endgroup$
    – Emma
    7 hours ago











    7












    $begingroup$

    Since the stock is listed on NASDAQ, you have access to fairly standard 10Q and 10K financial statements. So you can apply the analysis pioneered by Ed Altman in his Z-score paper - compare this company's fundamental ratios with those of other companies, and see how many of them went bankrupt historically. For example, Moody's KMV uses this approach to estimate "EDF" (expected default frequency) for many corporate credits.






    share|improve this answer









    $endgroup$


















      7












      $begingroup$

      Since the stock is listed on NASDAQ, you have access to fairly standard 10Q and 10K financial statements. So you can apply the analysis pioneered by Ed Altman in his Z-score paper - compare this company's fundamental ratios with those of other companies, and see how many of them went bankrupt historically. For example, Moody's KMV uses this approach to estimate "EDF" (expected default frequency) for many corporate credits.






      share|improve this answer









      $endgroup$
















        7












        7








        7





        $begingroup$

        Since the stock is listed on NASDAQ, you have access to fairly standard 10Q and 10K financial statements. So you can apply the analysis pioneered by Ed Altman in his Z-score paper - compare this company's fundamental ratios with those of other companies, and see how many of them went bankrupt historically. For example, Moody's KMV uses this approach to estimate "EDF" (expected default frequency) for many corporate credits.






        share|improve this answer









        $endgroup$



        Since the stock is listed on NASDAQ, you have access to fairly standard 10Q and 10K financial statements. So you can apply the analysis pioneered by Ed Altman in his Z-score paper - compare this company's fundamental ratios with those of other companies, and see how many of them went bankrupt historically. For example, Moody's KMV uses this approach to estimate "EDF" (expected default frequency) for many corporate credits.







        share|improve this answer












        share|improve this answer



        share|improve this answer










        answered 17 hours ago









        Dimitri VulisDimitri Vulis

        3158




        3158






























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