Altman Z-Score Calculator
Calculate a simplified Altman Z-Score to estimate a public company's risk of financial distress or bankruptcy within two years.
About the Altman Z-Score Calculator
The Altman Z-Score combines five financial ratios into a single score used to estimate the likelihood a public manufacturing company will face bankruptcy within the next two years.
Formula: Z = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E, where A = Working Capital/Total Assets, B = Retained Earnings/Total Assets, C = EBIT/Total Assets, D = Market Value of Equity/Total Liabilities, and E = Sales/Total Assets.
As a rough guide, a score above 2.99 suggests a "safe zone," between 1.81 and 2.99 is a "grey zone" worth monitoring, and below 1.81 falls in the "distress zone" historically associated with elevated bankruptcy risk. This simplified version uses the original coefficients developed for publicly traded manufacturers.