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, Matrix Composites & Engineering'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.
Matrix Composites & Engineering (ASX:MCE) Probability of Financial Distress (%) Explanation
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk in the upcoming year. 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.
Matrix Composites & Engineering Probability of Financial Distress (%) Related Terms
ASX:MCE vs PWR, FIX, EME: Probability of Financial Distress (%) Comparison
For the Engineering & Construction subindustry, Matrix Composites & Engineering'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.
Matrix Composites & Engineering Probability of Financial Distress (%) vs Construction Industry
For the Construction industry and Industrials sector, Matrix Composites & Engineering's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Matrix Composites & Engineering's Probability of Financial Distress (%) falls into.
Matrix Composites & Engineering 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
=
-6.56
The Probability of Financial Distress (%) (PFD) was then obtianed by:
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).
What does a Probability of Financial Distress (%) of 0.14% mean?
Matrix Composites & Engineering (ASX:MCE) has a Probability of Financial Distress (%) of 0.14% as of Jun. 27, 2026.
Is Matrix Composites & Engineering's Probability of Financial Distress (%) too high?
Matrix Composites & Engineering's current Probability of Financial Distress (%) is 0.14%. Overall, Matrix Composites & Engineering has a GF Score™ of 38/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Matrix Composites & Engineering's Probability of Financial Distress (%) compare to PWR and FIX?
Matrix Composites & Engineering's Probability of Financial Distress (%) of 0.14% can be compared against companies in the Construction industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Probability of Financial Distress (%) for a Construction company?
A good Probability of Financial Distress (%) depends on the Construction industry context. However, Probability of Financial Distress (%) should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Probability of Financial Distress (%) mean?
A high Probability of Financial Distress (%) can signal that a stock is expensive relative to its fundamentals. Matrix Composites & Engineering's current Probability of Financial Distress (%) is 0.14%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Matrix Composites & Engineering stock overvalued right now?
Based on GuruFocus' analysis, Matrix Composites & Engineering (ASX:MCE) is currently considered Fairly Valued. The stock's GF Value™ is A$0.38, compared to a current price of A$0.40 — trading 3.9% above its estimated fair value. The current Probability of Financial Distress (%) is 0.14%. Matrix Composites & Engineering's overall GF Score™ is 38/100 with 10 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Probability of Financial Distress (%) calculated?
Probability of Financial Distress (%) is calculated from a company's financial statements. For Matrix Composites & Engineering (ASX:MCE), the current Probability of Financial Distress (%) is 0.14% as of Jun. 27, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Matrix Composites & Engineering (ASX:MCE) Overvalued in 2026?
Based on GuruFocus' analysis, Matrix Composites & Engineering stock appears to be overvalued.
The current stock price of A$0.40 is trading 3.9% above its estimated GF Value™ of A$0.38.
GuruFocus considers Matrix Composites & Engineering to be Fairly Valued.
Key valuation signals for ASX:MCE:
Probability of Financial Distress (%): 0.14%
GF Value™: A$0.38 vs. price of A$0.40 (3.9% above fair value)
No single metric tells the full story. See the ASX:MCE stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Matrix Composites & Engineering Business Description
Matrix Composites & Engineering Ltd is a manufacturer of engineered products and services for the offshore oil and gas, civil and infrastructure, and defence industry. The group is also involved in the businesses of manufacturing and supplying capital drilling equipment, consisting of syntactic foam buoyancy; manufacturing and supply of subsea umbilical risers and flowline (SURF) ancillary equipment and associated services; and manufacturing and supply of well construction products, including centralizers and conductors. Its products consist of buoyancy systems, epoxy resin systems, energy absorption systems, reinforced thermoplastics, and others. Geographically, it derives maximum revenue from Brazil and rest from Australia, Japan, China, the United States of America, and other regions.
38GF Score
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