GURUFOCUS.COM » STOCK LIST » Consumer Defensive » Retail - Defensive » Innovative Food Holdings Inc (OTCPK:IVFH) » Definitions » Probability of Financial Distress (%)

IVFH (Innovative Food Holdings) Probability of Financial Distress (%) : 0.02% (As of Mar. 14, 2025)


View and export this data going back to . Start your Free Trial

What is Innovative Food Holdings 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, Innovative Food Holdings'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 Innovative Food Holdings's Probability of Financial Distress (%)

For the Food Distribution subindustry, Innovative Food Holdings'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.


Innovative Food Holdings's Probability of Financial Distress (%) Distribution in the Retail - Defensive Industry

For the Retail - Defensive industry and Consumer Defensive sector, Innovative Food Holdings's Probability of Financial Distress (%) distribution charts can be found below:

* The bar in red indicates where Innovative Food Holdings's Probability of Financial Distress (%) falls into.



Innovative Food Holdings 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
=-8.38

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

NIMTAAVG=Net Income / Market Total Assets
=Net Income / (Market Cap + Total Liabilities)

*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

TLMTA=Total Liabilities / Market Total Assets

3. CASHMTA = Cash to Market Total Assets

For non-financial companies, CASHMTA is measured as:

CASHMTA=Cash, Cash Equivalents, Marketable Securities / Market Total Assets

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).


Innovative Food Holdings  (OTCPK:IVFH) 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.


Innovative Food Holdings Probability of Financial Distress (%) Related Terms

Thank you for viewing the detailed overview of Innovative Food Holdings's Probability of Financial Distress (%) provided by GuruFocus.com. Please click on the following links to see related term pages.


Innovative Food Holdings Business Description

Traded in Other Exchanges
N/A
Address
9696 Bonita Beach Road, Suite 208, Bonita Springs, FL, USA, 34135
Innovative Food Holdings Inc through its subsidiaries is engaged in the distribution of perishables and specialty food products. Its customers include restaurants, hotels, country clubs, national chain accounts, casinos, hospitals, and catering houses. The company distributes perishable and specialty food and food-related products, including origin-specific seafood, domestic and imported meats, exotic game and poultry, artisanal cheeses, freshly prepared meals, caviar, wild and cultivated mushrooms, micro-greens, organic farmed and manufactured food products, estate-bottled olive oils and aged vinegar. The company also drop ship specialty foods to Professional Chefs nationally through the websites of broadline distributors, such as US Foods, Inc.
Executives
James C Pappas 10 percent owner 1177 WEST LOOP SOUTH, SUITE 1320, HOUSTON TX 77027
Denver Johnson Smith director 350 S RACE STREET, DENVER CO 80209
Jefferson Gramm director C/O BANDERA PARTNERS LLC, 50 BROAD STREET, SUITE 1820, NEW YORK NY 10004
Samuel Klepfish director, officer: CEO 231 NORMAN AVENUE, BROOKLYN NY 11222
Brady Smallwood director, officer: Chief Operating Officer 4505 NE BIRCHGROVE PL, BENTONVILLE AR 72712
Robert William Bennett director, officer: Chief Executive Officer 28411 RACETRACK RD, BONITA SPRINGS FL 34135
Hank Cohn director 14 CHARLOTTE DRIVE, WESLEY HILLS NY 10977
Richard Tang officer: Chief Financial Officer C/O INNOVATIVE FOOD HOLDINGS, INC., 28411 RACETRACK RD, BONITA SPRINGS FL 34135
David Polinsky director 90 BOOTH AVENUE, ENGLEWOOD NJ 07631
Jcp Investment Management, Llc 10 percent owner 1177 WEST LOOP SOUTH, SUITE 1320, HOUSTON TX 77027
Mark Schmulen 10 percent owner, other: See Explanation of Responses 11 GREENWAY PLAZA, SUITE 2400, HOUSTON TX 77046
Loukas D. Kozonis 10 percent owner, other: See Explanation of Responses 4849 N. MILWAUKEE AVENUE, SUITE 300, CHICAGO IL 60630
Jcp Investment Holdings, Llc 10 percent owner 1177 WEST LOOP SOUTH, SUITE 1320, HOUSTON TX 77027
Jcp Investment Partners, Lp 10 percent owner 1177 WEST LOOP SOUTH, SUITE 1320, HOUSTON TX 77027
Jcp Investment Partnership, Lp 10 percent owner 1177 WEST LOOP SOUTH, SUITE 1320, HOUSTON TX 77027