What is Hawaiian Electric Industries Probability of Financial Distress (%)?
Probability of Financial Distress (%) measures the probability that a company will go bankrupt in the upcoming year given its current financial position. A higher ratio indicates a larger probability of bankruptcy for the company, while a lower ratio indicates a healthier fundamental. As of today, Hawaiian Electric Industries's Probability of Financial Distress (%) is 0.19%.
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.
Competitive Comparison of Hawaiian Electric Industries's Probability of Financial Distress (%)
For the Utilities - Regulated Electric subindustry, Hawaiian Electric Industries's Probability of Financial Distress (%), along with its competitors' market caps and Probability of Financial Distress (%) data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Hawaiian Electric Industries's Probability of Financial Distress (%) Distribution in the Utilities - Regulated Industry
For the Utilities - Regulated industry and Utilities sector, Hawaiian Electric Industries's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Hawaiian Electric Industries's Probability of Financial Distress (%) falls into.
Hawaiian Electric Industries Probability of Financial Distress (%) Calculation
Probability of Financial Distress (%) (PFD) was developed by John Campbell, Jens Hilscher and Jan Szilagyi in their Search of Distress Risk. It measures the probability that a company will go bankrupt within the next 12 months given its current financial position.
The Probability of Financial Distress (%) was obtained by a logit probability model based on eight explanatory variables. The logit formula to compute the probability of financial distress (LPFD) is given below:
| LPFD | = | -20.12 * NIMTAAVG | + | 1.60 * TLMTA | - | 7.88 * EXRETAVG | + | 1.55 * SIGMA | - | 0.005 * RSIZE | - | 2.27 * CASHMTA | + | 0.070 * MB | - | 0.09 * PRICE | - | 8.87 |
| = | -6.27 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.19% |
The eight explanatory variables are:
1. NIMTAAVG = Net Income to Market Total Assets
*Note that for companies reported quarterly, geometrically declining weighted quarterly Net Income data in latest four quarters are used.
2. TLMTA = Total liabilities to Market Total Assets
3. CASHMTA = Cash to Market Total Assets
For non-financial companies, CASHMTA is measured as:
4. EXRETAVG = Excess Return compared to the S&P 500
EXRETAVG is the weighted excess return compared to the S&P 500 in past 12 month. Geometrically declining weights are imposed on the monthly excess return to reflect lagged information. The weight is halved each quarter.
5. SIGMA = Standard Deviation of Daily Returns
For sigma, we use the annualized standard deviation of a company's returns over the past 92 days (or 63 trading days).
6. RSIZE = Relative Size
| RSIZE | = | log (Market Cap | / | Total Market Cap of S&P 500 companies) |
7. MB = Market to Adjusted Book Equity Ratio
8. PRICE
PRICE is measured as the log of the stock price, capped at log(15).
Hawaiian Electric Industries (Hawaiian Electric Industries) Business Description
Traded in Other Exchanges
Address
1001 Bishop Street, Suite 2900, Honolulu, HI, USA, 96813
Hawaiian Electric Industries is the parent company of three Hawaii-based regulated utilities and Hawaii's American Savings Bank. The utilities provide electricity on the five islands of Oahu, Hawaii, Maui, Molokai, and Lanai. Nearly 40% of electricity in its service territory comes from renewable energy; this portion is growing rapidly as the state has set a goal of 100% by 2045.
Executives
| Scott Deghetto |
officer: EVP, CFO & Treasurer |
P.O. BOX 730, HONOLULU HI 96808 |
| Bruce Tamashiro |
officer: Controller, PAO |
P.O. BOX 730, HONOLULU HI 96808 |
| Keith P Russell |
director |
200 SPECTRUM CENTER DRIVE, SUITE 2100, IRVINE CA 92618 |
| Yoko Otani |
director |
P.O. BOX 730, HONOLULU HI 96808 |
| Michael J. Kennedy |
director |
P.O. BOX 730, HONOLULU HI 96808 |
| Elisia Flores |
director |
PO BOX 730, HONOLULU HI 96808 |
| Gregory C Hazelton |
officer: SVP - Finance |
220 NW SECOND AVENUE, PORTLAND OR 97209 |
| Lau Constance H |
director, officer: President |
C/O HAWAIIAN ELECTRIC INDUSTRIES, INC., P O BOX 730, HONOLULIU HI 96808 |
| Ann Teranishi |
officer: Pres & CEO, Amer Savings Bank |
P.O. BOX 730, HONOLULU HI 96813 |
| Kimura Shelee M.t. |
officer: Pres & CEO, Hawn Electric Co. |
C/O P.O. BOX 730, HONOLULU HI 96808 |
| Valueact Spring Master Fund, L.p. |
director, other: See Remarks |
ONE LETTERMAN DRIVE, BUILDING D, 4TH FLOOR, SAN FRANCISCO CA 94129 |
| Valueact Spring Master Fund A, L.p. |
director, other: See Remarks |
ONE LETTERMAN DRIVE, BUILDING D, FOURTH FLOOR, SAN FRANCISCO CA 94129 |
| Richard F Wacker |
officer: Pres & CEO, Amer Savings Bank |
|
| Seu Scott W.h. |
officer: Pres & CEO, Hawn Electric |
C/O P.O. BOX 730, HONOLULU HI 96808 |
| Valueact Capital Management, Llc |
director, other: See Remarks |
ONE LETTERMAN DRIVE, BUILDING D, 4TH FLOOR, SAN FRANCISCO CA 94129 |
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