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, Ethan Allen Interiors'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.
Ethan Allen Interiors (NYSE:ETD) 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.
Ethan Allen Interiors Probability of Financial Distress (%) Related Terms
ETD vs XMAX, AMWD, HBB: Probability of Financial Distress (%) Comparison
For the Furnishings, Fixtures & Appliances subindustry, Ethan Allen Interiors'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.
Ethan Allen Interiors Probability of Financial Distress (%) vs Furnishings, Fixtures & Appliances Industry
For the Furnishings, Fixtures & Appliances industry and Consumer Cyclical sector, Ethan Allen Interiors's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Ethan Allen Interiors's Probability of Financial Distress (%) falls into.
Ethan Allen Interiors 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
=
-8.34
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 0.02% mean?
Ethan Allen Interiors (ETD) has a Probability of Financial Distress (%) of 0.02% as of Jun. 26, 2026.
Is Ethan Allen Interiors' Probability of Financial Distress (%) too high?
Ethan Allen Interiors' current Probability of Financial Distress (%) is 0.02%. Overall, Ethan Allen Interiors has a GF Score™ of 71/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Ethan Allen Interiors' Probability of Financial Distress (%) compare to XMAX and AMWD?
Ethan Allen Interiors' Probability of Financial Distress (%) of 0.02% can be compared against companies in the Furnishings, Fixtures & Appliances 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 Furnishings, Fixtures & Appliances company?
A good Probability of Financial Distress (%) depends on the Furnishings, Fixtures & Appliances 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. Ethan Allen Interiors's current Probability of Financial Distress (%) is 0.02%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Ethan Allen Interiors stock overvalued right now?
Based on GuruFocus' analysis, Ethan Allen Interiors (ETD) is currently considered Modestly Undervalued. The stock's GF Value™ is $24.66, compared to a current price of $22.41 — trading 9.1% below its estimated fair value. The current Probability of Financial Distress (%) is 0.02%. Ethan Allen Interiors' overall GF Score™ is 71/100 with 3 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 Ethan Allen Interiors (ETD), the current Probability of Financial Distress (%) is 0.02% as of Jun. 26, 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 Ethan Allen Interiors (ETD) Overvalued in 2026?
Based on GuruFocus' analysis, Ethan Allen Interiors stock appears to be undervalued.
The current stock price of $22.41 is trading 9.1% below its estimated GF Value™ of $24.66.
GuruFocus considers Ethan Allen Interiors to be Modestly Undervalued.
Key valuation signals for ETD:
Probability of Financial Distress (%): 0.02%
GF Value™: $24.66 vs. price of $22.41 (9.1% below fair value)
No single metric tells the full story. See the ETD stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Ethan Allen Interiors Inc through its subsidiaries, operates as an interior design company, and a manufacturer and retailer in the home furnishings marketplace. Its product offerings include fabric chairs, beds, wallpapers, desks, and dining tables among others. The company's reportable segments are; Wholesale and Retail. The Wholesale segment is principally involved in the development of the Ethan Allen brand and encompasses all aspects of design, manufacturing, sourcing, marketing, sale, and distribution of home furnishings and accents. The Retail segment which generates maximum revenue, sells home furnishings and accents to clients through company-operated design centers. Geographically, it derives key revenue from the United States and the rest from other regions.
71GF Score
Get the complete analysis for ETD
Probability of Financial Distress (%) is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
ETD has been successfully added to your 