Alloy Steel Inc. (fka AYSI)

[DaveinHackensack]

A quick Z-score tutorial for Brig

So we can just link to this post next time you ask whether the Z-score takes _____ into account.

The Altman Z-Score model uses these five terms:

T1 = Working Capital / Total Assets
T2 = Retained Earnings / Total Assets
T3 = Earnings Before Interest and Taxes / Total Assets
T4 = Market Value of Equity / Total Liabilities
T5 = Sales / Total Assets



And weights them this way:

Z Score Bankruptcy Model:

Z = 1.2T1 + 1.4T2 + 3.3T3 + .6T4 + 1T5

If you don't see it above, it's not in the Z-score.