What is CRA International 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, CRA International's Probability of Financial Distress (%) is 0.02%.
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 CRA International's Probability of Financial Distress (%)
For the Consulting Services subindustry, CRA International'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.
CRA International's Probability of Financial Distress (%) Distribution in the Business Services Industry
For the Business Services industry and Industrials sector, CRA International's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where CRA International's Probability of Financial Distress (%) falls into.
CRA International 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 |
| = | -8.48 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.02% |
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).
CRA International (CRA International) Business Description
Traded in Other Exchanges
Address
200 Clarendon Street, Boston, MA, USA, 02116-5092
CRA International Inc is a U.S.-based advisory firm that provides economic, financial, and management consultancy services. The company advises clients on economic and financial issues relating to litigation and regulatory proceedings and helps businesses set important business strategies and solve performance-related issues. The company's clients include domestic and foreign companies, government agencies, public and private utilities, and national and international trade associations. CRA International generates almost all its revenue from the United States and the United Kingdom.
Executives
| Paul A Maleh |
officer: EVP, Platform Leader |
200 CLARENDON STREET, T-9, BOSTON MA 02116 |
| Chad M Holmes |
officer: CFO, EVP and Treasurer |
200 CLARENDON STREET, T-9, BOSTON MA 02116 |
| Jonathan D Yellin |
officer: EVP and General Counsel |
200 CLARENDON STREET, T-9, BOSTON MA 02116 |
| Thomas Aiken Avery |
director |
465 LAUREL CHASE COURT, ATLANTA GA 30327 |
| Heather Tookes |
director |
C/O FTAC OLYMPUS ACQUISITION CORP., 2929 ARCH STREET, SUITE 1703, PHILADELPHIA PA 19104 |
| Robert W Holthausen |
director |
200 CLARENDON STREET, T-9, BOSTON MA 02116 |
| Alva Taylor |
director |
C/O CRA INTERNATIONAL, INC., 200 CLARENDON STREET, BOSTON MA 02116 |
| Nancy Hawthorne |
director |
AVID TECHNOLOGY, INC., 75 NETWORK DRIVE, BURLINGTON MA 01803 |
| Christine Rose Detrick |
director |
200 CLARENDON STREET, T-9, BOSTON MA 02116 |
| Daniel K. Mahoney |
officer: CFO, EVP and Treasurer |
C/O OLD MUTUAL ASSET MANAGEMENT, 200 CLARENDON STREET, BOSTON MA 02116 |
| Richard Douglas Booth |
director |
200 CLARENDON STREET, T-9, BOSTON MA 02116 |
| William F Concannon |
director |
200 PARK AVENUE, 17TH FLOOR, NEW YORK NY 10166 |
| Rowland Moriarty |
director |
200 CLARENDON ST T33, BOSTON MA 02116 |
| Robert A Whitman |
director |
4200 TEXAS COMMERCE TOWER WEST, 2200 ROSS AVE, DALLAS TX 75201 |
| Douglas C Miller |
officer: VP, Chief Accounting Officer |
ONE AMERICAN ROW, P.O. BOX 5056, HARTFORD CT 06052 |
CRA International (CRA International) Headlines
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