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The Altman Z-Score is a model designed to predict the likelihood of a company going bankrupt within the next two years. Created by American finance professor Edward Altman in 1968, the model is specifically designed for publicly traded manufacturing companies with assets greater than $1 million.
DST Systems has a Altman Z-Score of 3.88, indicating it is in Safe Zones. This implies the Altman Z-Score is strong.
The zones of discrimination were as such:
When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.
The historical rank and industry rank for DST Systems's Altman Z-Score or its related term are showing as below:
The historical data trend for DST Systems's Altman Z-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
DST Systems Annual Data | |||||||||||||||||||||
Trend | Dec08 | Dec09 | Dec10 | Dec11 | Dec12 | Dec13 | Dec14 | Dec15 | Dec16 | Dec17 | |||||||||||
Altman Z-Score | Get a 7-Day Free Trial | 4.29 | 3.40 | 3.60 | 3.38 | 3.42 |
DST Systems Quarterly Data | ||||||||||||||||||||
Mar13 | Jun13 | Sep13 | Dec13 | Mar14 | Jun14 | Sep14 | Dec14 | Mar15 | Jun15 | Sep15 | Dec15 | Mar16 | Jun16 | Sep16 | Dec16 | Mar17 | Jun17 | Sep17 | Dec17 | |
Altman Z-Score | Get a 7-Day Free Trial | 3.38 | 3.63 | 3.24 | 3.09 | 3.42 |
For the Software - Infrastructure subindustry, DST Systems's Altman Z-Score, along with its competitors' market caps and Altman Z-Score 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.
For the Software industry and Technology sector, DST Systems's Altman Z-Score distribution charts can be found below:
* The bar in red indicates where DST Systems's Altman Z-Score falls into.
Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
DST Systems's Altman Z-Score for today is calculated with this formula:
Z | = | 1.2 | * | X1 | + | 1.4 | * | X2 | + | 3.3 | * | X3 | + | 0.6 | * | X4 | + | 1.0 | * | X5 |
= | 1.2 | * | 0.0226 | + | 1.4 | * | 0.5069 | + | 3.3 | * | 0.1902 | + | 0.6 | * | 2.9366 | + | 1.0 | * | 0.755 | |
= | 3.88 |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency. GuruFocus does not calculate Altman Z-Score when X4 or X5 value is 0.
Trailing Twelve Months (TTM) ended in Dec. 2017:
Total Assets was $2,938 Mil.
Total Current Assets was $1,038 Mil.
Total Current Liabilities was $971 Mil.
Retained Earnings was $1,489 Mil.
Pre-Tax Income was 99.2 + 61.8 + 108.7 + 262.2 = $532 Mil.
Interest Expense was -7.1 + -6.9 + -6.9 + -5.9 = $-27 Mil.
Revenue was 593.9 + 562.6 + 656.2 + 405.5 = $2,218 Mil.
Market Cap (Today) was $4,983 Mil.
Total Liabilities was $1,697 Mil.
* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.
X1 | = | Working Capital | / | Total Assets |
= | (Total Current Assets - Total Current Liabilities) | / | Total Assets | |
= | (1037.7 - 971.3) | / | 2938.2 | |
= | 0.0226 |
X2 | = | Retained Earnings | / | Total Assets |
= | 1489.3 | / | 2938.2 | |
= | 0.5069 |
X3 | = | Earnings Before Interest and Taxes | / | Total Assets |
= | (Pre-Tax Income - Interest Expense) | / | Total Assets | |
= | (531.9 - -26.8) | / | 2938.2 | |
= | 0.1902 |
X4 | = | Market Value Equity | / | Book Value of Total Liabilities |
= | Market Cap | / | Total Liabilities | |
= | 4983.410 | / | 1697 | |
= | 2.9366 |
X5 | = | Revenue | / | Total Assets |
= | 2218.2 | / | 2938.2 | |
= | 0.755 |
The zones of discrimination were as such:
Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones
DST Systems has a Altman Z-Score of 3.88 indicating it is in Safe Zones.
Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.
DST Systems (NYSE:DST) Altman Z-Score Explanation
X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.
X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.
X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.
X4, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.
X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.
Read more about Altman Z-Score and the original research.
Be Aware
Altman Z-Score does not apply to financial companies.
Thank you for viewing the detailed overview of DST Systems's Altman Z-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
Samuel G Liss | director | VERISK ANALYTICS, INC., 545 WASHINGTON BOULEVARD, JERSEY CITY NJ 07310 |
Gary D Forsee | director | C/O INGERSOLL-RAND COMPANY, 155 CHESTNUT RIDGE ROAD, MONTVALE NJ 07645 |
Joseph C Antonellis | director | STATE STREET CORPORATION, ONE LINCOLN STREET, BOSTON MA 02111 |
Charles E Haldeman | director | C/O JBG/OPERATING PARTNERS, L.P., 4445 WILLARD AVENUE, SUITE 400, CHEVY CHASE MD 20815 |
Edmund J Burke | officer: President of Subsidiary | 1290 BROADWAY, SUITE 1100, DENVER CO 80203 |
Lynn Dorsey Bleil | director | 333 WEST 11TH STREET, KANSAS CITY MO 64105 |
Stephen C Hooley | director, officer: Chairman, CEO & President | 2355 WAUKEGAN ROAD, BANNOCKBURN IL 60015 |
A Edward Allinson | director | STATE STREET BOSTON CORP 225 FRANKLIN STREET BOSTON MA 02110 |
John W Clark | director | 949 SOUTH COAST DRIVE, SUITE 650, COSTA MESA CA 92626 |
George L Argyros | director | ARNEL & AFFILIATES, 949 SOUTH COAST DR SUITE 600, COSTA MESA CA 92626 |
Lawrence M Higby | director | C/O APRIA HEALTHCARE GROUP INC, 26220 ENTERPRISE COURT, LAKE FOREST CA 92630 |
Thomas A Mcdonnell | director, officer: CEO & Director | C/O KANSAS CITY SOUTHERN, 427 W 12TH STREET, KANSAS CITY MO 64105 |
M Jeannine Strandjord | other: Retired Director as of 5/9/12 | |
William C Nelson | director | 6521 WE NONGA TERRACE, MISSION HILLS KY 66208 |
Thomas A Mccullough | director | C/O DST SYSTEMS, 333 WEST 11TH ST 5TH FL, KANSAS CITY MO 64105 |
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