What is Leggett & Platt 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, Leggett & Platt's Probability of Financial Distress (%) is 0.14%.
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 Leggett & Platt's Probability of Financial Distress (%)
For the Furnishings, Fixtures & Appliances subindustry, Leggett & Platt'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.
Leggett & Platt's Probability of Financial Distress (%) Distribution in the Furnishings, Fixtures & Appliances Industry
For the Furnishings, Fixtures & Appliances industry and Consumer Cyclical sector, Leggett & Platt's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Leggett & Platt's Probability of Financial Distress (%) falls into.
Leggett & Platt 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 |
| = | -6.59 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.14% |
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).
Leggett & Platt (Leggett & Platt) Business Description
Traded in Other Exchanges
Address
No. 1 Leggett Road, Carthage, MO, USA, 64836
Leggett & Platt Inc designs and produces engineered components and products found in most homes and automobiles. It operates its business through three segments namely Bedding Products, Specialized Products, and Furniture, Flooring and Textile Products. Serving a broad suite of customers around the world, Leggett & Platt's products include bedding components, automotive seat support and lumbar systems, specialty bedding foam and private label finished mattresses, components for home furniture and work furniture, flooring underlayment, adjustable beds, and various other products.
Executives
| Ryan Michael Kleiboeker |
officer: SVP-Chief Strategic Plan. Off. |
NO.1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Phoebe A Wood |
director |
PO BOX 1080, LOUISVILLE KY 40201 |
| Scott S Douglas |
officer: SVP-Gen. Counsel and Secretary |
NO 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Karl G Glassman |
director, officer: Executive Vice President |
LEGGETT & PLATT, INCORPORATED, NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Angela Barbee |
director |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Benjamin Michael Burns |
officer: SVP-Business Support Services |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| James Tyson Hagale |
officer: SVP, Pres. - Bedding Products |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Christina Ptasinski |
officer: SVP - Chief HR Officer |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| J Mitchell Dolloff |
director, officer: President and COO |
NO.1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Steven K Henderson |
officer: Executive Vice President |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Tammy M Trent |
officer: SVP - Chief Accounting Officer |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Jeffrey L. Tate |
officer: Executive Vice President - CFO |
2211 H.H. DOW WAY, MIDLAND MI 48674 |
| Susan R Mccoy |
officer: SVP - Investor Relations |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
| Judy C Odom |
director |
2140 MERRITT DRIVE, GARLAND TX 75401 |
| Maryelizabeth R Campbell |
director |
NO. 1 LEGGETT ROAD, CARTHAGE MO 64836 |
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