Altman Z"-Score Model

The Altman Z"-Score Model is a financial tool used to predict a company's likelihood of bankruptcy. It combines five key financial ratios that assess a firm’s profitability, leverage, liquidity, and efficiency. By plugging these ratios into a formula, you get a score that indicates the company's financial health. A higher score suggests lower bankruptcy risk, while a lower score signals higher risk. This model helps investors, creditors, and analysts make informed decisions about a company's stability and financial future.